Vat- 


Cataloged 


SOUND  MONE 


Bimetalism  a  Necessity  of  the  World, 


The  Existing  Ratio  of  Parity,  16, 154,  15  to  1,  Unalterable. 


THE    UNITED    STATES    COMPETENT    TO     RE-ESTABEISH 
BIMETAEISM  BY  RE-OPENING  HER  MINTS   TO  SIL- 
VER, WITHOUT   FOREIGN   CO-OPERATION. 


BY  ROBERT  W.  HUGHES. 


"Sound  money  is  that  sort  of  currency  which  has  the  most  universal  and  least  fluctuat- 
ing purchasing  power  in  the  markets  of  all  countries;  is  that  which  is  the  best  and  least 
fluctuating  measure  of  value  and  medium  of  exchange." — Secretary  Mortox. 

"The  money  of  the  world  should  he  a  fair  and  permanent  record  of  obligations  over  long 
periods  of  time." — A.  J.  Balfour. 

"  If  we  take  a  survey  of  mankind  in  ancient  or  modern  times,  as  regards  the  physical, 
mechanical  and  intellectual  forces  of  nations,  we  find  nothing  to  compare  with  the  United 
States  in  this  present  year  of  1895.  The  wealth  of  the  American  people  surpasses  that  of  any 
other  nation,  past  or  present.  *  *  *  The  United  States  in  1895  possess  by  far  the 
greatest  productive  power  in  the  world.  This  power  has  more  than  trebled  since  1860.  The 
accumulation  of  wealth  averages  $7,000,000  daily.  Yet  there  may  be  impartial  critics  who 
would  go  so  far  as  to  assert  that  Americans  might  have  turned  to  greater  advantage  the 
elements  at  their  disposal."— Mvlhall,  in  JTorth  American  Review  for  June,  1S95. 


i 


Wit,    ELLIS    JONES,    PRINTER,    RICHMOND,    VA. 

1895. 


i\ 


V 


PREFACE. 


The  following  essays  were  published  in  various  newspapers  at 
the  times  of  their  respective  dates.  The  statistics  which  they  em- 
body might  be  brought  down  to  the  present  time,  but  that  would 
seem  unnecessary.  The  excellent  platform  of  the  Cook  County 
Democrats,  of  Illinois,  is  published  as  an  epitome  of  the  princi- 
ples which  I  have  endeavored  to  elucidate  in  these  essa}rs.  I  have 
endeavored  to  use  as  little  repetition  as  possible  in  this  collective 
publication. 

ROBERT  W.  HUGHES. 


PAMPHLET  COLLECTION      THF  F,  OWrpc; 
uEffiUNTVEBSTTYUBPARY 


W  »  rPTtni\j 


SOUND    MONEY. 


The  Eatio  of  Parity.     Why  Holi  the  International  Conference  ? 


THE  LAW  OF  NATURE. 


ENGLAND'S  DOMINATION  AT  WASHINGTON— NO  THREAT- 
ENING OVER-PRODUCTION  OF  SILVER— NOT 
PLENTY  THAT  MAKES  TROUBLE. 


Who  hold  the  balance  of  the  world?     Who  reign 

O'er  Congress,  whether  royalist  or  liberal  ? 
Who  make  our  morning  journals  squeak  and  gibber-all, 

Who  keep  the  world,  both  old  and  new,  in  pain 
Or  pleasure  ?     Who  make  polities  run  glibber-all  ? 

Jew  Rothschild  and  his  fellow  Christian,  Baring. 

Those  are  the  lords  to-day.    Every  loan 

Is  not  merely  a  speculative  hit ; 
But  seats  a  nation  or  upsets  a  throne. 

Republics  also  get  involved  a  bit ; 
Columbia's  stocks  hath  holders  not  unknown 
On  Change. 

Norfolk,  May  16,  1895. 
To  the  Editor  of  the  Dispatch : 

Mr.  Edwards  Pierrepont  was  our  Minister  to  England  for 
several  years  during  General  Grant's  administration.  He  was  a 
citizen  of  New  York.  He  naturally  gave  much  attention  to  finan- 
cial subjects  during  his  residence  in  London.  He  was  always  an 
earnest  bimetalist.  He  was  an  able  writer  on  the  subject,  and 
thoroughly  conversant  with  it.  Some  time  before  the  stealthy 
demonetization  of  silver  in  the  United  States  by  the  legislation  of 
1873,  he  had  become  aware  of  the  formation  of  their  gold  trust  by 
the  principal  bankers  of  Europe,  the  chief  object  of  which  was  to 


4  SOUND  MONEY. 

bring-  about  in  the  United  States  the  enactment  of  1873,  as  they 
had  done  the  action  of  Germany  in  1871. 

ISTot  long  ago,  in  an  article  in  the  North  American  Review,  Mr. 
Pierrepont  said:  "There  are  no  silver  mines  of  importance  in 
the  British  Empire,  but  gold  mines  of  vast  production.  To  keep 
up  the  price  of  this  metal  by  artificial  means  England  formed  a 
trust  long  before  the  oil  or  sugar  trust  was  formed  in  America. 
She  gave  free  coinage  to  gold,  and  not  to  silver,  and  passed  an  act 
of  Parliament  compelling  the  Bank  of  England  to  purchase  all 
the  gold  offered  at  3  pounds  17  shillings  and  9  pence  per  ounce 
standard,"  etc.,  etc. 

The  amount  of  coined  gold  money  in  use  among  the  civilized 
nations  being  supposed  to  be  something  more  than  3,500  millions  of 
dollars  the  object  of  the  Gold  Trust  was  to  obtain  control  of  this 
money.  It  is  said  that  the  Rothschilds  alone  now  control  2,000 
millions  of  it.  Six  sevenths  of  the  whole  is  supposed  to  be  in 
control  of  the  trust.  They  sought  control  of  money  in  order  to 
control  prices.  With  all  their  wealth  the  Gold  Trust  knew  they 
would  be  unable  to  control  the  gold  of  civilized  nations  if  there 
were  a  greater  amount  of  legal-tender  silver  money  circulating  in 
the  hands  of  the  people. 

The  demonetization  of  silver  was  therefore  an  essential  part  of 
their  scheme.  They  early  set  to  work  to  effect  this  object.  They 
succeeded  in  Germany.  They  had  a  still  easier  success  in  our 
Congress,  by  means  of  secrecy  and  treachery. 

THE    GOLD    TRUST    VS.    THE    AMERICAN    PEOPLE. 

This  grand  coup  was  accomplished  in  1873  by  stealth;  for  it  is 
the  right  of  the  American  people  to  pass  at  the  polls  upon  every 
great  measure  of  government.  Yet  a  policy  of  finance  more  sub- 
versive of  popular  liberty  and  more  destructive  of  domestic  pros- 
perity than  any  ever  before  conceived  by  the  human  mind  was 
secretly  established  in  our  republic  in  1873,  without  the  sanction, 
even  without  the  knowledge,  of  the  people.  Stolen  measures  are 
not  often  honest  measures.  Gold  monometalism  in  this  country 
is  the  goods  of  a  theft.  But  all  great  frauds  recoil  upon  their  per- 
petrators. The  American  people  are  about  to  assert  their  right  to 
pass  upon  this  policy.  They  are  going  to  exercise  this  high  pre- 
rogative and  say,  "Let  it  stand,"  or,  "Let  it  fall."     The  campaign 


SOUND  MONEY.  5 

of  education  is  begun,  and  the  authors  of  the  policy,  forced  out 
of  their  tactics  of  stealth  and  secrecy,  must  at  last  meet  their 
adversaries  face  to  face,  toe  to  toe. 

I  wish  to  sav  something  about  the  ratio  of  parity  between  the 
two  money  metals  ;  something  about  the  proposed  call  of  an  inter- 
national conference  for  settling  this  ratio,  and  something  on  the 
interesting  question  whether  gold  or  silver  is  the  steadier,  the 
sounder,  the  more  honest  of  the  two  monies. 

WHETHER  NATURE  OR  BANKERS  CONTROL. 

With  many  students  of  finance  the  pons  asinorum  in  the  way  of 
a  return  to  the  constitutional  policy  of  bimetalism  is  the  supposed 
necessitv  of  securing  beforehand,  bv  international  agreement,  a 
conventional  ratio  of  parity  between  gold  and  silver.  The  mistake 
of  such  students  is  in  assuming  that  this  much  desired  ratio  is  a  thing 
of  artificial  ascertainment  and  contrivance,  to  be  mathematically 
worked  out  by  ingenious  minds,  and  dogmatically  decreed  by 
some  Sanhedrim  of  miscegenated  savans,  Semitically  dominated, 
and  convened  from  Europe  and  America  for  the  purpose.  On  the 
contrary,  the  ratio  is  a  self-established  fact  resulting  by  evolution, 
automatically,  from  the  natural  conditions  affecting  the  two  metals 
all  the  world  over. 

I  am  not  much  given  to  superstition,  but  I  believe  that  a  wise 
and  beneficent  Creator  designed  this  earth  for  human  habitation, 
and  provided  here  all  things  which  could  be  useful  and  necessary 
to  the  well-being  and  happiness  of  the  human  race  which  He 
placed  upon  it.  Among  His  many  gifts  were  two  very  remarkable 
ones.  First,  He  gave  us  language  and  letters  with  which,  by 
speech  and  writing,  we  may  express  our  thoughts  to  each  other  in 
a  manner  necessary  to  high  civilization,  and  unknown  and  impos- 
sible to  the  dumb  beasts  which  He  made  subject  to  our  uses.  The 
other  of  these  gifts  was  money,  by  means  of  which  we  might  carry 
on  the  work,  traffic  and  business  of  society  with  perfect  facility, 
convenience,  accuracy  and  confidence.  From  the  earliest  histoiw, 
through  all  the  periods  of  time  down  to  our  own  day,  gold  and 
silver  have  been  the  universal  money  of  mankind.  Local  experi- 
ment has  occasionally  been  made  with  other  substances,  but  in 
every  instance  it  has  ended  in  speedy  and  disgusting  failure.  The 
only  money  which  has  stood  the  test  of  ages,  the  only  money  of 


6  SOUND  MONEY. 

nature  and  nature's  God,  current  all  over  the  earth,  has  been  gold 
and  silver.  This  great  fact,  this  amazing  miracle,  the  contempla- 
tion of  which  fills  every  thoughtful  soul  with  gratitude  to  the 
Giver  of  all  good  and  perfect  gifts,  is  so  familiar  and  universal  a8 
to  have  become  commonplace;  so  that  in  our  enlightened  age  there 
are  men  who  essay  to  improve  upon  the  work  of  Almighty  God, 
and  think  they  can  tinker  successfully  with  the  subject  of  money 
by  interfering  with  the  materials  which  have  constituted  it  from 
time  immemorial.  If  I  may  use  the  privilege  of  Mr.  Cleveland, 
and  indulge  in  mere  dogmatism,  I  will  say  that,  as  surely  as  there 
are  settled  laws  of  nature,  as  surely  as  this  gift  of  money  to  man- 
kind conies  from  a  higher  than  human  source,  this  tinkering  will 
come  to  grief.  The  ratio  of  metals  is  one  of  the  facts  of  money, 
fixed  by  a  higher  power  than  man's,  fixed  by  a  friend  of  the  human 
race,  fixed  by  the  ordination  of  One  more  honest  than  any  petty 
king  of  the  London  Gold  Trust. 

Sir  Roderick  Murchison,  one  of  the  most  learned  and  highly 
respected  financial  writers  of  modern  times,  states  the  principle  of 
ratio  in  these  words :  "  The  quantities  of  gold  and  silver  procur- 
able will  prove  no  more  than  sufficient  to  meet  the  exigencies  of 
an  enormously  increased  population  and  an  augmenting  commerce 
and  industry.  Providence  seems  to  have  originally  adjusted  the 
relative  values  of  the  precious  metals,  and  the  fact  that  their  rela- 
tions have  remained  the  same  for  ages  will  survive  all  theories." 

AUTOMATICALLY  WORKED  OUT  BY  NATURE. 

Let  us  examine  what  lesson  is  taught  by  the  facts  of  the  subject. 
I  will  first  premise,  and  then  prove,  that  the  existing  ratios  have 
been  determined  automatically,  and  not  by  contrivance.  They 
are  16  to  1  in  America,  where  nearly  all  silver  is  produced,  and 
where  it  is  cheapest;  15^  to  1  in  Europe,  where  it  becomes  a  lit- 
tle dearer  by  transportation,  and  much  of  it  coined  and  recoined 
at  expense,  and  15  to  1  in  Asia  and  the  East,  after  it  has  undergone 
still  further  transportation  at  additional  expense.  These  ratios  are 
practically  one  and  the  same,  and  we  speak  of  them  in  America, 
for  brevity's  sake,  as  16  to  1. 

How  did  this  ratio  come  about?  ISTo  international  conference 
ever  agreed  upon  or  decreed  it.  Such  a  decree  would  have  been 
brutum  fulmen.  -  The  ratio  cannot  be  the  subject  of  dogmatic  ful- 


SOUND  MONEY.  7 

mination.  It  comes  from  a  very  simple  fact.  Suppose  there  were 
16,000  millions  of  ounces  of  silver  in  the  world  in  use  as  money. 
Suppose  there  were  1,000  millions  of  ounces  of  gold  in  the  world, 
also  in  use  as  money.  Suppose  that  the  use  of  both  of  these  sorts 
and  quantities  of  money,  interchangeably,  was  convenient  and 
agreeable  to  mankind  and  universally  customary ;  then  that  very 
fact  of  the  use  in  common  and  interchangeably  of  these  respective 
quantities  of  money  would  establish  the  ratio  of  parity  between 
the  two  metals  at  16  to  1. 

It  is  equally  true  that  if  at  any  time  the  amounts  of  the  two 
metals  in  circulation  among  mankind,  stated  in  francs,  or  dollars, 
or  guineas,  or  other  coins,  are  equal  to  each  other — as,  for  instance, 
if  there  are  3,500  millions  of  dollars'  worth  of  gold  in  use  and  the 
same  number  of  dollars'  worth  of  silver  also  in  use,  both  moneys 
in  common,  interchangeable  use — then  this  equality  of  aggregate 
values  in  use  will  demonstrate  that  there  is  some  ratio  of  parity 
existing  between  the  two  metals;  and  if,  the  aggregate  values 
being  the  same,  the  individual  coins  of  silver  are  so  many  times 
heavier  than  the  gold  coins  of  the  same  value,  then  that  so  many 
times  is  the  automatic  ratio  of  parity  existing  between  the  two 
metals.  This  ratio  has  been  15  or  16  to  1  for  ages,  and  it  is  this 
ratio  which  Sir  Roderick  Murchison  refers  to  when  he  says  it  will 
"  survive  all  theories." 

The  Director  of  the  Mint,  in  his  report  for  1894,  page  45,  gives 
as  the  stock  of  silver  in  the  world,  coined  and  uncoined,  but 
chiefly  coined,  $4,055,700,000. 

He  gives  as  the  like  stock  of  gold  in  the  world,  page  44, 
$3,965,900,000.  He  states  these  to  be  the  approximate  quantities 
of  the  two  metals  visible  and  reported.  They,  of  course,  do  not 
include  what  is  in  private  hoards,  or  in  the  pockets  of  individuals, 
or  very  much  of  what  is  in  the  use  of  uncivilized  populations. 
His  statements  of  the  visible  stocks  are  supposed  to  be  somewhat 
less  than  one-half  of  the  total  quantity  of  each  of  the  precious 
metals  in  the  world. 

THIS    PRACTICAL    EQUALITY. 

These  quantities  in  value  given  by  the  mint  report  of  the  stocks 
of  the  two  metals  visible  and  in  use  are  nearly  equal  to  each  other, 
the  difference  being  only  ninety  millions. 


8  SOUND  MONEY. 

This  practical  equality  in  value  of  the  amounts  of  the  two 
metals  in  use  proves  that  the  ratio  on  which  these  values  are  esti- 
mated and  the  metals  are  coined,  of  16  to  1,  is  not  the  creature  of 
human  contrivance,  but  is  the  automatic  result  of  natural  laws. 

The  ratio  of  16  to  1  prevails  because  the  quantities  of  the  two 
metals  which  God's  gift  of  the  mines  and  man's  industry  in  work- 
ing them  have  produced  have  been  such  relatively  as  to  have 
established  that  ratio.  The  ratio  of  16  to  1  is  a  necessary  auto- 
matic corollary  of  the  world's  quantities  in  stock  of  the  two 
metals. 

The  Mint  Report  for  1894  gives,  pages  174-175,  the  quantities  of 
each  metal  produced  in  the  world  in  each  year  from  1492  to  1894, 
a  period  of  402  years.  The  total  for  the  period  was,  of  gold 
406,306,476  ounces,  and  of  silver,  7,664,023,716  ounces.  Multiply 
the  gold  by  16  and  we  get  6,500,900,616  ounces.  On  the  basis  of 
16  to  1  the  quantities  of  the  two  metals  produced  was  within 
$1,163,000,000  of  the  same  number  of  ounces  for  the  402  years, 
or  within  an  average  of  2,900,000  ounces  a  year  in  the  402  years. 

Stated  in  values  instead  of  quantities,  the  production  of  gold 
in  the  period  according  to  the  mint  report  was  $8,399,101,000 
worth;  and  of  silver  $9,909,041,000  worth,  valued  at  the  ratio  of 
15J  to  1.  That  is  to  say,  in  the  long  period  of  more  than  four 
hundred  years  the  excess  of  silver  production  over  that  of  gold 
was  only  $1,509,940,000  worth,  valued  at  the  ratio  of  15 J  to  1,  the 
excess  of  silver  being  only  $3,774,850  worth  a  year.  When  we 
consider  that  silver  is  the  money  of  the  million  and  not  of  bank- 
ers ;  that  it  is  in  constant,  daily  use,  and  not  stored  in  vaults ;  that 
it  is  more  carelessly  handled  than  gold  and  more  liable  to  be  lost 
on  land  and  sea  and  is  more  subject  to  abrasion  and  casualty,  we 
are  bound  to  conclude  that  this  difference  in  production  is  oblit- 
erated, and  that  nature  has  provided  this  small  excess  of  produc- 
tion in  silver  over  gold  to  meet  such  losses  as  have  been  described, 
and  thereby  preserve  the  equilibrium  of  the  two  metals  on  the 
natural  ratio  of  16  to  1. 

NATURE    IS    ABLE    TO    MAINTAIN    IT. 

As  to  the  ability  of  nature  and  nature's  God  to  maintain  the 
value  of  silver  at  the  ratio  of  16  to  1,  compared  with  gold,  we 
have  no  lack  of  proof.     A  table  is  given  below,  taken  from  the 


SOUND  MONEY. 


9 


Mint  Report  of  1891,  page  158,  showing  the  commercial  value  of 
silver  compared  with  gold  during  the  period  extending  from  the 
beginning  of  the  present  century  down  to  1873,  when  silver  was 
demonetized  in  the  United  States.  The  table  shows  the  ratio 
value  of  silver  compared  with  gold,  as  metals  sold  in  the  market 
by  weight,  in  each  year  of  the  period  1800  to  1873.  The  legal 
ratio  being  16  to  1,  it  will  be  borne  in  mind  by  the  reader  that 
when  the  table  shows  the  comparative  value  of  silver  to  be  16, 
silver  has  been  at  a  commercial  parity  with  gold,  and  whenever 
the  numeral  has  been  less  than  16  silver  has  been  at  a  premium 
over  gold.     Here  is  the  table  :     (See  Mint  Keport,  page  158.) 


1801,  silver  compared  with 

1802, 

1803, 

1804, 

1805, 

1806, 

1807, 

1808, 

1809, 

1810, 

1811, 

1812, 

1813, 

1814, 

1815, 

1816, 

1817, 

1818, 

1819, 

1820, 

1821, 

1822, 

1823, 

1824, 

1825, 

1826, 

1827, 

1828, 

1829, 

1830, 

1831, 

1832, 

1833, 

1834, 


gold 15 .  46 

15.26 

15.41 

15.41 

1579 

15  52 

15.43 

16.08 

15.96 

15.77 

15  53 

16.11 

16.25 

15  04 

15.26 

15.28 

15.11 

15.35 

15.33 

15.62 

15.95 

.'. ...  15.80 

15 . 84 

15.82 

15  70 

15.76 

15.74 

15  78 

15.78 

15.82 

15  72 

15.72 

15.93 

15.73 


10 


SOUND  MONEY. 


1835,  sil 

ver  compared  with  j 

1S36, 

u 

1837, 

li 

1838. 

M 

1839, 

11 

1840, 

a 

1841, 

u 

1842, 

u 

1843, 

(( 

1S44, 

u 

1845, 

u 

1846, 

a 

1847, 

u 

1848, 

a 

1849, 

a 

1850, 

u 

1851, 

u 

1852, 

(i 

1853, 

it 

1854, 

ti 

1 855, 

U 

1856, 

it 

1857, 

u 

1858, 

c( 

1859, 

l( 

1860, 

U 

1861, 

a 

1862, 

It 

1863, 

tt 

1864, 

u 

1865, 

« 

1866, 

a 

1867, 

a 

1S68, 

a 

1869, 

u 

1870, 

11 

1871, 

a 

1872, 

a 

1873, 

a 

lo 

15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 
15. 


80 
72 
83 
85 
62 
62 
70 
87 
93 
85 
92 
90 
80 
85 
78 
70 
46 
59 
33 
33 
38 
38 
27 
38 
19 
29 
50 
35 


44 
43 
57 
59 
60 
57 
57 
63 
92 


It  will  be  seen  that  in  only  three  of  the  seventy-three  years  has 
the  comparative  value  of  silver  been  as  low  as  16  to  1.  It  has 
been  more  valuable  than  gold  at  16  to  1  throughout  the  period 
named — that  is  to  say,  in  every  year  but  three  it  has  taken  less 
silver  than  sixteen  ounces  to  buy  an  equal  quantity  of  gold — and 
silver  has  been  at  a  commercial  premium. 


SOUND  MONEY.  11 

England's  domination  at  Washington. 

Even  if  considered  with  reference  to  the  European  ratio  of  15| 
to  1,  silver  was  relatively  more  valuable  than  gold  in  twenty-three 
years  of  the  present  century  previous  to  its  demonetization.  Apro- 
pos of  the  apparently  superior  value  of  gold  in  the  other  fifty 
years  of  the  period,  it  is  to  be  observed  that  the  Director  of  our 
Mint  takes  his  quotations  from  the  London  sales;  and  that  these 
are  notoriously  cooked  as  much  as  possible  against  silver,  it  being 
the  policy  of  England  to  cheapen  American  silver  in  order  that 
her  profit  on  it  when  sent  to  the  East  may  be  greater. 

The  Director  of  the  Mint  avows  that  these  quotations  are  of  sales 
in  London.  Does  he  not  know  that  there  silver  is  demonetized, 
and  that  it  sells  there  of  necessity  below  its  money  value?  Wh}T 
did  he  not  give  the  quotations  of  American  sales  ?  How  pitiably 
true  is  it  that  our  Treasury  Department  is  little  else  than  a  pro- 
vincial bureau  of  the  Bank  of  England,  more  absolutely  domina- 
ted by  it  than  the  British  Exchequer  itself.  Our  Treasury  officers 
do  their  work  and  make  up  their  reports  under  the  infatuating 
spell  of  the  Basilisk  of  the  Thames,  whose  gaze  transfixes  them 
and  paralizes  every  sentiment  of  manly  Americanism  in  their 
natures. 

If  the  same  page  of  the  mint  report  from  which  the  foregoing 
ratios  have  been  copied  be  consulted  it  will  be  seen  that  for  114 
years  before  the  beginning  of  the  present  century  silver  wTas  more 
valuable  than  gold,  even  measured  by  the  European  ratio  of  15J 
to  1,  except  in  four  years — that  is  to  say,  was  more  valuable  in 
110  years  out  of  114,  even  in  sales  in  London. 

These  tables  teach,  however,  that  throughout  the  period  of 
nearly  two  centuries  the  differences  and  variations  in  relative 
value  between  the  twro  metals,  were  so  inconsiderable  and  trivial 
as  to  have  been  of  no  material  importance.  They  were  practically 
the  same,  and  they  illustrate  the  truth  of  Sir  Roderick  Murchi- 
son's  remark,  that  nature  furnishes  the  two  metals  in  such  relative 
quantities  as  to  establish  and  maintain  the  ratio  of  15  or  16  to  1 
en  permanence. 

This  steadiness  of  relative  value,  as  shown  by  the  figures  that 
have  been  given,  are  marvellous.  JSTo  intelligent  mind,  no  rev- 
erent student  of  the  subject,  can  fail   to  feel  that  any  arbitrary 


12  SOUND  MONEY. 

and  artificial  disturbance  of  this  ratio  would  be  revolutionary, 
abnormal,  and  in  its  consequences  pernicious,  if  not  in  its  spirit 
impious.  Have  we  not  already  experienced  very  baleful  results 
from  the  blunder  and  crime  of  1871-73,  when  Germany  and  the 
United  States  surrendered  their  financial  independence  to  Eng- 
land ?  Why  should  England  be  permitted  to  enter  into  a  con- 
ference held  in  the  interest  of  silver  which  she  refuses  to  respect 
as  money,  and  wThich  she  has  plotted  against  for  eighty  years  ?  \ 

NATURE    SCORNS    TO    HELP    THOSE    WHO    REJECT    HER    GIFTS. 

For  nothing  cau  be  more  destructive  to  the  long-established 
ratio  between  the  values  of  the  two  metals  that  has  been  described 
than  the  demonetization  of  one  of  them.  In  order  that  either 
shall  retain  its  value  relatively  to  the  other  it  must  be  in  full  and 
untrammelled  use  as  money.  In  order  to  be  money,  it  must  pos- 
sess two  requisites — it  must  be  legal  tender  by  fiat  of  the  muni- 
cipal law,  and  it  must  enjoy  the  privilege  in  the  public  mints  of 
being  converted  into  coins  in  the  manner  prescribed  by  law.  If 
denied  either  of  these  privileges,  either  of  the  precious  metals, 
except  so  much  of  it  as  consists  of  coins  already  minted  and 
already  enjoying  the  function  of  legal  tender,  ceases  to  hold  its 
money  value,  and  becomes  a  mere  commodity  of  the  market.  It 
can  be  money  only  when  in  the  form  of  coins. 

The  principal  value  of  the  precious  metals  is  derived  from  their 
use  as  money.  If  any  article  of  value  to  the  human  race  be  de- 
prived of  the  use  for  which  it  is  intended  by  nature  it  will  fall  in 
price.  If  by  some  infatuation  mankind  were  induced  by  design- 
ing men  to  refuse  to  make  use  of  wheat  and  corn  for  daily  food, 
even  those  prime  necessaries  of  life  would  lose  most  of  their  value 
in  the  market.  A  Virginia  farmer  the  other  day,  after  reading 
this  essay  as  published  in  the  Dispatch,  said,  in  referring  to  Mr. 
Cleveland's  idea  of  depreciated  silver  dollars,  "  wheat  and  corn 
would  go  down  lower  too  if  the  people  were  fool  enough  to  quit 
eating  them." 

iSTature  establishes  the  ratio  of  parity  between  gold  and  silver 
only  as  money.  It  ceases  to  perform  this  office  when,  with  sacri- 
legious hand,  the  minions  of  Mammon  degrade  either  of  the 
metals  into  merchandise.  As  long  as  both  are  upheld  as  money 
by  municipal  law,  nature  establishes  their  relative  values  automa- 


SOUND  MONEY.  18 

tically.  It  is  true  that  the  ratio  of  nature  varies  slightly  with 
varying  times,  circumstances  and  conditions,  and  that  this  tendency 
to  inconsiderable  variations  needs  to  be  steadied  by  artificial  laws 
of  legal  tender  and  coinage.  But  these  laws  act  simply  as  the 
balance-wheel  acts  in  regulating  the  movement  of  machinery; 
they  fix  and  hold  steady  the  ratio  which  nature,  by  her  own  great 
laws,  has  alreadv  established.  There  can  be  no  international  con- 
ference  competent  to  fix  a  ratio  for  the  two  money  metals  which 
shall  not  have  nature  and  nature's  God  as  constituent  members  of 
it,  and  I  am  inclined  to  believe  that  these  two  financiers  can  estab- 
lish a  firm  and  sound  ratio  better  without  the  aid  of  Gentile  and 
Jew  conferrees  than  with  it. 

SILVEK    A    SOUNDER    AND    STEADIER    MONEY. 

If  experience  and  history  establish  any  truth  in  finance,  it  is 
that  silver,  so  louff  as  it  is  used  and  maintained  as  monev.  is  of 
more  steady  and  certain  value  than  gold.  Systems  of  finance 
based  on  gold  are  notoriously  panicky.  Those  based  on  silver  are 
subject  to  comparatively  few  and  slight  perturbations.  Those 
based  on  both  moneys  are  as  steady  as  the  North  Star. 

They  have  gold  monometalism  in  the  country  which  is  now  the 
financial  sovereign  of  the  United  States.  For  full  two  generations 
England  has  been  conspicuous  for  the  frecpaeney  and  violence  of 
its  commercial,  banking  and  monetary  panics.  The  rate  of  inter- 
est of  the  Bank  of  England  is  a  financial  barometer,  whose  changes 
indicate  with  infallible  certainty  the  revolutions  that  occur  in  the 
money  market  of  London.  This  rate  was  changed  no  less  than 
223  times  in  the  twenty-seven  years,  beginning  with  1847.  and  the 
range  of  rates  was  from  1\  to  10  per  cent.  The  monometalic  gold 
standard  was  adopted  in  1816,  and  in  the  122  years  preceding  that 
event  there  were  only  sixteen  changes,  and  the  rate  of  interest 
never  fell  below  4  nor  rose  above  6  per  cent.  The  late  Mr.  Jevons, 
an  English  writer  and  statistican  of  the  highest  authority,  in  his 
volume  on  money  predicted  in  1875  that  the  sensitiveness  of  the 
money  market  would  increase  under  the  present  system  of  Eng- 
land, and  declared  it  probable  that  commercial  crisis  would,  from 
time  to  time,  recur,  even  exceeding  in  their  violence  and  disastrous 
consequences  those  whose  history  we  know  too  well.  The  pre- 
diction has  been  abundantly  fulfilled.     Mr.  Giffen,  the  "  militant 


14  SOUND  MONEY. 

monometalist,"  says  in  an  article  in  the  Contemporary  Review : 
"  The  course  of  the  money  market  since  1871,  when  the  German 
Government  began  to  draw  gold  from  London,  has  been  full  of 
stringencies.  The  crises  of  1873  and  1875  were,  no  doubt,  precipi- 
tated by  them,  and  since  1876,  in  almost  every  year  except  1879 
and  1880,  there  has  been  a  stringency  of  greater  or  less  severity, 
directly  traceable  to  or  aggravated  by  the  extraordinary  demands 
for  gold  and  the  difficulty  of  supplying  them." 

Compare  the  Bank  of  England  with  the  Bank  of  France.  The 
latter  often  has  to  help  the  former  out  of  trouble,  the  case  is  never 
vice  versa.  The  one  redeems  in  gold  only ;  the  other  in  gold  or 
silver,  at  its  own  pleasure.  ISio  run  is  ever  made  on  the  Bank  of 
France.  The  Bank  of  England  changes  its  rate  of  interest  to  pre- 
vent runs,  figuratively  speaking,  with  every  moon. 

The  reason  of  the  stability  of  silver  is,  that  it  is  the  money  of 
the  people  of  the  world,  current  everywhere,  within  the  reach  of 
poor  and  rich,  in  the  pockets  of  the  high  and  the  low,  never 
hoarded,  never  vaulted,  never  hid  out  of  sight.  Of  the  fifteen  hun- 
dred and  fifty  millions  of  people  in  the  world,  twelve  hundred 
millions,  or  four-fifths,  use  silver  alone,  and  only  two  hundred  and 
eighty  millions  use  both  gold  and  silver,  the  rest  having  no  money 
at  all.  How  is  it  possible  for  a  substance  which  is  the  only  money 
of  twelve  hundred  millions  of  people,  who  never  have  enough 
of  it,  ever  to  be  variant  and  fickle  in  value  ?  A  few  nations 
in  Europe  and  a  great  English  dependency  in  America  may 
demonetize  silver  wholly  or  partially,  and  thereby  destroy  or 
diminish  its  value  in  their  special  localities,  but  in  the  rest  of  the 
world  it  asserts  its  prerogative  as  money  with  the  glad  acclaim  of 
loyal  millions.  Even  in  Europe  the  quantity  of  silver  in  welcome 
circulation  is  little  short  of  that  of  gold,  and  in  Shermanized  and 
Tory  dominated  America  we  have  much  of  it  of  full-coin  value 
busiW  at  work  among  the  people  making  a  campaign  of  education 
preparatory  to  1896. 

PRICES    OF    INDUSTRIAL    PRODUCTS. 

With  all  this  history  back  of  it,  with  twelve  hundred  millions  of 
the  inhabitants  of  God's  earth  using  silver  alone  at  the  high  ratio  of 

15  to  1,  and  craving  more  than  they  can  get  of  it ;  with  all  Europe 
short  in  metallic  money  and  hankering  wistfully  for  a  largely 


SOUXD  MONEY.  15 

increased  use  of  silver  money,  and  with  our  own  people  indignant 
at  the  fall  in  prices  of  all  the  products  of  industry  in  field,  factory 
and  mines  through  the  fraud  of  1873,  who  can  doubt  that  when- 
ever  the  privilege  of  the  American  mints  withheld  now  by  Eng- 
land shall  be  restored  to  silver,  that  metal  will  instantly  leap  to 
parity  with  gold  at  the  ratio  of  16  to  1,  and  maintain  it  as  steadily 
as  it  did  from  1686  to  1873  ? 

It  is  easy  to  show  that,  even  under  the  violently  disturbing 
measure  of  1871-1873,  bv  which  silver  was  reduced  by  England 
in  her  two  financial  dependencies,  Germany  and  the  United 
States,  to  a  mere  mercantile  commodity,  the  value  of  silver  has 
been  more  steady  than  that  of  gold.  Of  course  the  comparison  of 
silver  demonetized  must  not  be  with  gold,  which  is  the  onlv  mon- 
etized  metal,  but  must  be  with  other  substances  of  commerce, 
which,  like  itself,  has  not  the  money  function. 

The  tables  of  Mr.  Augustus  Sauerbeck,  which  are  accepted  as 
reliable  by  all  writers  on  the  subject  of  prices,  show  that  the  ave- 
rage yearly  prices  of  forty-five  leading  commodities  of  commerce, 
compared  with  their  average  prices  in  the  period  of  1867-1877, 
had  fallen  by  June,  1894,  compared  with  gold,  37  per  cent.,  which 
is  equivalent  to  saving  that  the  purchasing  power  of  gold  had 
increased  as  to  the  forty -five  articles  of  trade,  55  per  cent.  More 
particularly,  if  we  select  out  of  the  forty-five  articles  alluded  to, 
the  seven  most  largely  bought  and  sold  in  the  markets — to-wit : 
wheat,  corn,  potatoes,  rice,  pig-iron,  cotton  and  wool — the  tables 
of  Sauerbeck  show  that  during  the  twenty  years,  1873  to  1893, 
the  average  fall  in  the  price  of  these  staples  in  gold  was  43  per 
cent.,  which  is  equivalent  to  saying  that  an  ounce  of  gold  would 
purchase  75 \  per  cent,  more  of  them  in  1893  than  it  would  in  1873. 
Thus  the  value  of  gold  fluctuated  during  the  period  of  1873  to 
1893  as  much  as  55  per  cent,  in  reference  to  forty-five  articles,  and 
75J  per  cent,  in  respect  to  the  seven  most  important  of  them.  On 
the  other  hand,  these  tables  show  that  in  comparison  with  these 
articles  of  commerce  silver  fluctuated  only  4  per  cent.,  although 
demonetized,  losing  that  much  in  relative  value.  In  short,  in  1893, 
gold  bought  55  or  lb\  per  cent,  more  of  the  produce  of  man's 
labor  than  in  1873,  and  silver  4  per  cent.  less.  Secretary  Morton 
says  that  what  Mr.  Cleveland  calls  "  sound  money  is  that  sort  of 
currency  which  has  the  most  universal  and  least  fluctuating  pur- 


16  SOUND  MONEY. 

chasing  power  in  the  markets  of  all  countries ;  "  is  that  which  is 
"  the  best  and  least  fluctuating  measure  of  value  and  medium  of 
exchange."  Mr.  A.  J.  Balfour  adds  an  important  ingredient  to 
Secretary  Morton's  definition — viz :  "  The  money  of  the  world 
should  be  a  fair  and  permanent  record  of  obligations  over  long 
periods  of  time."  Tried  by  this  true  test,  what  becomes  of  Mr. 
Morton's  monometalic  gold,  and  how  pitiably  does  it  compare  in 
steadiness  of  value  with  demonetized  silver  ? 

THERE    IS    NO    THREATENING    OVERPRODUCTION    OF    SILVER. 

It  is  very  plain  from  what  has  been  shown  in  the  foregoing 
paragraphs  that  unless  there  shall  occur  some  extraordinary  dimi- 
nution in  the  production  of  gold  and  a  simultaneous  increase  in 
that  of  silver,  nature's  ratio  of  15-16  to  1  must  continue  indefi- 
nitely, and  that  silver  remonetized,  even  by  the  United  States 
alone,  would  continue  to  maintain  that  steadiness  of  value  which 
had  marked  its  history  for  centuries  before  its  rash  demonetization 
in  the  United  States  without  the  authority  of  our  people  in  1873. 

The  monometallists  accordingly  claim,  not  that  the  gold  pro- 
duction is  falling  off,  but  that  the  silver  production  is  increasing 
in  a  degree  that  must  compel  a  change  of  the  standard  ratio,  at 
the  expense  ot  silver.  In  proof  of  this  claim  they  refer  to  the 
table  on  page  fifty-two  of  the  Mint  Report  for  1894,  that  table 
showing  the  production  of  gold  and  silver  in  the  years  1870  to 
1892.  It  is  useless  to  give  the  whole  table  here.  Let  three  years 
be  taken.  The  production  of  gold  and  silver  in  the  world  during 
the  years  to  be  named,  stated  in  dollars'  worth  on  the  ratio  of  15J 
to  1,  was  as  follows  : 

1870— Gold,  $106,850,000;  silver,  $51,575,000. 
1880— Gold,  $106,500,000;  silver,  $96,700,000. 
1892— Gold,  $138,860,000  ;  silver,  $196,459,000. 

In  the  whole  period — 1870-'92 — of  twenty-three  years  the  pro- 
duction of  gold  was  $2,489,962,000,  and  that  of  silver,  $2,524,964,- 
000,  the  excess  in  the  production  of  silver  in  the  period  having 
been  $35,002,000,  or  an  average  of  a  million  and  a  half  a  year. 
It  is  obvious  that  these  figures  fail  to  show  a  production  of  silver 
threatening  to  nature's  long-established  ratio  of  15-16  to   1.     In 


SOUND  MONEY.  17 

1870,  and  for  nine  years  following,  there  was  an  abnormal  falling 
off  in  the  production  of  silver,  while  that  of  gold  remained  steady 
and  largely  in  excess  of  silver.  Since  1880  there  has  been  a 
steady  increase  in  the  production  of  both  metals,  large  of  both, 
but  larger  of  silver  than  of  gold.  An  increase  in  the  production 
of  both  metals  cannot  affect  the  ratio,  unless  the  excess  of  one 
over  the  other  is  extraordinarily  great.  As  yet  the  greater  increase 
in  the  production  of  silver  has  not  been  sufficient  to  compensate 
for  the  ten  years  of  greater  activity  in  gold.  It  would  require  a 
continuation  for  as  many  as  fifty  or  a  hundred  years  of  an  exces- 
sive production  of  silver  over  gold,  to  affect  the  ratio.  For  be  it 
kept  in  mind  that  the  precious  metals  are  not  like  the  annual 
crops  of  grain,  cotton,  and  the  like  articles,  consumed  in  their  use, 
but  remain  in  permanent  use  for  centuries  and  ages.  The  parlia- 
mentary gold  and  silver  commission  of  England  estimated  a  few 
years  ago,  that  the  gold  and  silver  in  the  world  in  all  forms  and  in 
all  hands  was  ten  thousand  millions  of  dollars'  worth  of  silver  and 
eight  thousand  millions  of  dollars'  worth  of  gold.  What  effect 
upon  this  ocean  of  ten  thousand  millions  of  silver  could  the  mil- 
lion and  a  half  of  excess  a  year  since  1870  produce  upon  the 
ratio  ?  It  is  like  emptying  a  coffee-pot  into  the  sea.  [Nature  seems 
to  have  provided  in  every  period  of  years  an  excess  of  silver  pro- 
duction over  that  of  gold  to  compensate  the  greater  abrasion  and 
loss  by  casualty,  the  far  greater  waste,  of  the  popularly-used  metal 
than  that  sustained  by  the  carefully-vaulted  metal  of  the  bankers. 

Nor  is  there  any  certainty  that  in  the  next  ten  years  there  will 
be  an  excess  in  the  silver  production  such  as  has  marked  the  last 
ten  years.  We  may  again  witness  an  excess  in  the  gold  production 
similar  to  that  which  occurred  in  the  decade  1870-'80.  It  is  not 
for  international  conferences  to  divine  conditions  yet  hidden  in  the 
womb  of  the  future. 

As  will  have  been  seen,  there  was  a  very  large  gold  production 
in  the  decade  1870-1880,  and  a  notably  small  silver  production. 
Yet,  it  was  then  that  silver  was  demonetized  by  Germany  and  the 
United  States.  There  was  no  pretence  that  this  was  done  because 
silver  was  growing  too  plentiful ;  the  fear  was  as  to  gold.  Silver 
was  demonetized  to  keep  up  the  value  of  gold,  by  the  contrivance 
of  England,  Mr.  Pierrepoint  explains  why.  The  production  of 
2;old  has  continued  to  increase  through  the  decade  1880-1890;  sil- 


18  SOUND  MONEY. 

ver  production  also  experiencing  a  large  increase,  which  was 
abnormal,  and  is  now  abating.  Nature  in  the  two  coming  decades 
will,  most  probably,  bring  back  the  wonted  equilibrium;  but  God 
grant  that  the  production  of  both  metals  may  continue  large,  as 
one  of  the  richest  blessings  He  can  bestow  upon  mankind.  (See 
the  Note  at  the  end  of  this  essay.) 

THIS    REPUBLIC    COMPETENT. 

The  reason  alleged  against  independent  action  by  the  United 
States  in  restoring  to  silver  the  privilege  of  the  mints  has  been 
the  supposed  importance  of  waiting  for  a  ratio  from  an  inter- 
national conference.  It  has  been  shown  that  such  an  expectation 
is  illusory.  Free  coinage  will  have  to  wait,  but  not  for  the  action 
of  a  conference.  The  bimetalists  of  the  United  States,  while 
confident  that  the  action  of  this  countiw  alone  would  restore  silver 
to  fall  parity  the  world  over,  have  yet  felt  that  it  might  be  our 
true  policy  to  let  the  European  nations  (Germany  especially)  feel 
the  pinch  of  the  shoe  for  awhile,  and  endure  for  a  year  or  two 
longer  the  curses  of  gold  monometalism  before  any  step  on  our 
part  be  taken.  The  election  of  1896  must  intervene  before  the 
policy  of  the  United  States  can  be  determined,  and  there  will  be 
a  further  interval  of  delay  between  this  election  and  the  instalment 
of  a  new  administration. 

So  far,  therefore,  as  our  own  nation  is  concerned,  the  question 
of  when  to  remonetize  settles  itself.  The  galled  jades  must  wince — 
Germany  and  the  States  of  the  Latin  Union — until  contrition  comes, 
until  they  are  fairly  seated  upon  the  stool  of  repentance  for  the 
folly  of  1871.  Silver  has  its  avenging  Nemesis  doing  effective 
work  for  it ;  a  goddess  who  is  supposed  to  be  especially  severe 
upon  the  proud  and  insolent ;  of  wThom  the  possessors  of  unright- 
eous wealth  are  the  most  conspicuous.  The  accumulation  of  hon- 
est wealth  invigorates  the  State  ;  it  is  honorable  in  motive  and 
wholly  beneficial  in  result.  The  massing  of  dishonest  wealth 
undermines  integrity,  demoralizes  enterprise,  discourages  right 
methods,  paralyzes  healthy  endeavor,  and  involves  the  producing 
classes  of  society  in  discontent  and  unrest.  Unrighteous  wealth 
is  the  upas-tree  of  modern  civilization.  It  rotted  and  destroyed 
the  Roman  Empire  and  civilization. 

There  is  no  room  for  any  present  dread  of  "  silver  monomet- 


SOUND  MONEY.  19 

alism,"  that  pons  asini  of  Mr.  Cleveland.  Silver  monometalism 
could  only  come  from  an  unprecedented  excess  in  the  production 
of  the  metal,  for  fifty  years  or  more,  concurrently  with  a  meagre 
production  of  gold.  A  great  increase  in  the  production  of  gold 
and  silver,  both,  would  be  an  incalculable  blessing  to  mankind, 
and  the  monometalism  of  either  would  be  the  mere  hoba;oblin  of 
the  demagogue. 

The  manly  masses  of  our  people  do  not  sympathize  with  the 
monometalists  in  their  deprecation  of  "  over  "-production.  Noth- 
ing but  good  can  come  to  the  better  and  worthier  classes  of  soci- 
ety from  what  is  called  the  over-production  of  wheat  and  corn 
and  cotton  and  iron  and  coal  and  gold  and  silver.  What  mortal 
man  in  all  this  world  (not  a  monometalist)  is  afraid  of  PLEXTY  ? 
It  is  not  plenty  that  makes  trouble,  paralyzes  business,  and  pro- 
duces hard  times.  Over-production  is  always  a  blessing  to  the 
million.  What  pauperizes  mankind  is  not  the  undue  production, 
but  the  wanton  destruction  of  God's  best  gifts  to  His  creatures. 
When  Providence,  in  its  unbounded  generosity  to  the  human  race, 
increases  her  gift  of  a  metal  as  precious  to  the  millions  as  silver, 
and  the  minions  of  mammon,  in  wanton  and  impious  insolence, 
make  bold  to  intercept  that  gift  from  its  intended  beneficiaries, 
REBUKE  becomes  the  duty  of  the  hour.  It  is  the  habit  of  the 
American  people  to,  administer  rebuke  at  the  polls  to  enemies  of 
the  public  welfare.     They  will  do  so  in  1896. 


[NOTE.] 
LARGE  YIELD  OF  GOLD. 


Highest  Production  Reached  in  Twenty  Years. 


A  Very  Perceptible  Falling  Off  in  the  Output  of  Silver — An  Increase  in 
the  Production  of  Gold  Noticeable  Throughout  the  "World. 


The  Director  of  the  Mint,  Mr.  R.  E.  Preston,  estimates  the  production  of  gold 
by  the  mines  of  the  United  States,  approximately,  during  the  calendar  year  1894, 
to  have  been  1,910,800  fine  ounces,  of  the  coining  value  of  339,500,000,  an  increase 
over  1893  of  -53,500,000,  which  is  the  largest  amount  produced  in  any  year  since 
1878. 


20 


SOUND  MONEY. 


The  production  of  silver  from  the  mines  of  the  United  States  is  estimated  to 
have  approximated  in  1894,  49,500,000  ounces  of  the  coining  value  of  $64,000,000, 
showing  a  decrease  as  compared  with  1893  of  10,500,000  ounces. 

In  regard  to  the  product  of  the  world's  gold  and  silver  for  1894,  the  returns  are 
incomplete,  but  so  far  as  received,  show  an  increase  in  the  production  of  gold 
over  1893  of  about  821,000,000,  the  largest  increase  being  in  Africa,  viz :  89,600,- 
000;  Australia,  86,000,000;  followed  by  the  United  States  with  an  increase  of 
83,950,000.  Australia  leads  the  list  of  gold  producing  countries  for  1894,  with  a 
production  of  841,000,000;  the  United  States  taking  second  place. 

The  production  of  silver  in  the  world,  it  is  estimated,  will  be  from  145,000,000 
to  150,000,000  ounces  for  the  calendar  year  1894.  The  heaviest  falling  off  in  the 
production  is  in  the  United  States,  followed  by  Australia  ;  Mexico  showing  a  gain 
of  2,700,000  ounces.     Mexico  also  gains  in  her  production  of  gold  81,500,000. 

PRODUCTION    OF    GOLD    BY    STATES. 


The  director  estimates  the  production  of  gold  by  States  and  Territories  during 
the  calendar  year,  1894,  as  follows : 

State. 

Alaska 

Arizona 

California 

Colorado 

Georgia 


Idaho 

Michigan 

Montana 

Nevada 

New  Mexico. . . 
North  Carolina. 

Oregon 

South  Carolina . 
South  Dakota. 

Texas 

Utah 

"Washington .... 

Alabama 

Maryland 

Tennessee . . 

Virginia 

Vermont 

Wyoming 


ine  Ounces. 

Value. 

53,863 

81,113,350 

86,324 

1,784,475 

656,468 

13,570,397 

459,152 

9,491,514 

4,728 

97,736 

100,000 

2,081,291 

2,150 

44,444 

176,637 

3,651,410 

55,042 

1,137,819 

27,465 

567,751 

2,254 

46,594 

68,792 

1,422,056 

4,733 

97,832 

159,594 

3,299,100 

41,991 

868,031 

9,438 

195,100 

1,495 

30,903 

Total 1,910,813 


839,500,00 


AMOUNT    OF    SILVER    PRODUCED. 

The  estimates  of  silver  produced  by  the  same  States  and  Territories  during  the 
calendar  vear  is  as  follows : 


SOUND  MONEY.  21 

Coining  Value 

Fine  Ounces.  Measured  in  Gold. 

Alaska 22,261  828,728 

Arizona 1,147,204  1,483,254 

California 717,368  927,506 

Colorado -  23,281,399  30,101,203 

Georgia 325  420 

Idaho ? 3,288,545  4,251,860 

Michigan 35,122  45,410 

Montana 12,820,0S1  16,575,458 

Nevada 1,035,151  1,338,377 

New  Mexico 632,183  817,368 

North  Carolina 352  455 

South  Carolina 305  394 

Oregon '.  26,171  33.S37 

South  Dakota 58,937  76,24S 

Texas 429,314  555,073 

Utah   5,891.901  7,617,812 

Washington 113,160  146,308 

Alabama 

Maryland 


Tennessee 
Virginia . . 
Vermont  . 
Wyoming 


\ 


182.  235 


Total 49,500,000  864,000,000 

TOTAL    VALUE    OF    BOTH    METALS. 

The  total  value  of  the  gold  and  silver  produced  by  States  and  Territories  during 

the  calendar  vear  is  as  follows  : 

Total  Value 
State.  Gold  and  Silver. 

Alaska $1,142,332 

Arizona 3,267,729 

California ' 14,497,903 

Colorado 39,592,717 

Georgia 98,156 

Idaho 6,333,141 

Michigan 89,854 

Montana 20,226,S68 

New  Mexico 1,385,119 

North  Carolina 47,049 

Oregon 1,455,893 

South  Carolina 98,233 

South  Dakota 3,375,348 

Texas 555,073 

Utah 8,485,843 

Washington 341,408 

Alabama,  Maryland,  Tennessee,  Virginia,  Vermont,  Wyoming 31,138 


Total §103,500,000 


The  World-Wide  Business  Paralysis  and  its  Cause, 


ELECTIONS  CANNOT  CURE  THE  ILL, 


IT  IS   GROWING  IN  INTENSITY,  BREEDING  SOCIAL 
UNREST  AND  THREATENING  SOCIETY. 


[Note. — Mr.  Barr  Eobertson,  one  of  the  highest  authorities  on  the  subject,  said 
uncontradicted,  at  the  meeting  of  the  Royal  Society  of  Arts  in  London,  on  Janu- 
ary 19th,  1893,  that  "the  transfer  of  wealth  from  the  landed  and  propertied 
classes,  and  from  the  mercantile,  manufacturing  and  producing  classes  generally, 
in  the  United  Kingdom  of  Great  Britain  and  Ireland,  to  the  holders  of  securities, 
mortgages,  annuities  and  the  like,  cannot  be  less  than  two  thousand  millions  of 
pounds  sterling  (ten  thousand  millions  of  dollars),  due  solely  to  the  appreciation 
of  gold.  Such  a  colossal  increment  as  has  accrued  to  the  holders  of  securities, 
valued  in  gold,  during  the  last  twenty  years  in  Europe  and  the  United  States, 
amounting  to  not  less  than  seven  thousand  millions  of  pounds  sterling  ($35,000,- 
000,000),  is  entirely  unparallelled  in  the  history  of  the  world ;  all  other  questions 
sinking  into  utter  insignificance  compared  with  it."] 

Norfolk,  Va.,  November  18th,  1894. 

To  the  Editor  of  the  Norfolk  Pilot  : 

In  what  follows  I  shall  use  freely  of  language  not  my  own. 
I  shall  employ  that  of  some  of  the  most  conspicuous  men  of  our 
times.  The  severity  of  the  existing  depression  in  all  business  will, 
in  our  country,  under  the  influence  of  the  recent  elections,  be 
slightly  modified,  but  it  will  not  be  relieved — it  will  continue 
indefinitely. 

BIMETALISM    ALMOST    UNIVERSALLY    DESIRED. 

Not  only  America,  but  all  Europe  is  in  trouble.  Everyone 
admits  that  the  world  stands  on  the  edge  of  revolution,  social  and 
political,  but  everyone  shrinks  from  it.  Neither  north  nor  south, 
east  nor  west,  neither  capitalist  nor  laborer,  wishes  to  create  caste 


SOUND  MONEY.  23 

or  classes,  or  to  spread  misery,  oppression  or  violence.  We  all 
see  danger  before  us.  We  all  desire  to  avoid  it.  Our  only  dispute 
is  about  the  path. 

To  those  who  have  had  chiefly  in  mind  the  struggle  between 
silver  and  gold,  that  is  the  question  which,  for  the  moment,  presses 
hardest.  The  single  gold  standard  seems  to  be  working  ruin  with 
a  violence  that  nothing  can  stand.  If  its  influence  is  to  continue 
for  the  future  at  the  rate  of  its  action  during  the  twentv  years 
since  the  gold  standard  took  possession  of  the  world,  some  gene- 
ration, not  very  remote,  will  see  in  the  broad  continent  of  Amer- 
ica only  a  half  dozen  overgrown  cities  keeping  guard  over  a  mass 
of  capital,  and  lending  it  out  to  a  population  of  dependent  laborers 
on  the  mortgage  of  their  growing  crops  and  unfinished  handiwork. 
Such  sights  have  been  common  enough  in  the  world's  historv ; 
but  against  it  we  all  rebel.  Rich  and  poor  alike ;  labor  and  capi- 
tal ;  railways,  churches  and  colleges — all  alike,  and  all  in  solid 
good  faith,  shrink  from  such  a  future  as  that. 

This  agreement  is  the  best  part  of  the  situation.  Even  on  the 
burning  ground  of  silver  and  gold,  we  agree  in  principle.  Xo 
party  and  no  party  leader  has  ever  approved  of  the  single  gold 
standard.  Xot  one  American  in  a  hundred  believes  in  it.  We 
are  more  unanimous  in  hostility  to  it  than  we  are  on  any  other 
question  in  politics.  A  vast  majority  in  all  parties  agree  that  the 
single  gold  standard  has  been,  is,  and  will  be,  a  national  disaster 
of  the  worst  kind.  "What  is  still  more  strange,  almost  the  whole 
world  sympathizes  with  us.  Xine-tenths  of  mankind  are  hostile 
to  the  single  gold  standard.  Our  70,000,000  people  are  unanimous 
against  it.  Most  of  the  great  European  nations  and  their  govern- 
ments dislike  it.  South  America  rejects  it.  The  whole  of  Asia 
knows  only  silver,  and  India,  which  contains  five-sixths  of  all  the 
subjects  of  the  British  crown,  is  as  hostile  to  it  as  ourselves.  Yet 
the  bankers  of  London  have  said  that  we  must  submit,  and  we 
have  submitted.    • 

So  strange  a  spectacle  has  never  been  seen  in  our  history. 
Argument,  and  even  the  compulsive  proof  brought  by  world-wide 
ruin,  seems  to  be  helpless  against  this  astonishing  power.  "What 
is  the  use  of  argument  when  we  are  all  convinced,  and  when  at 
least  nine-tenths  of  the  civilized  and  uncivilized  world  agree  ? 
England  holds  us  to  the  single  sold  standard,  by  the  force  of  her 


24  SOUND  MONEY. 

capital  alone,  more  despotically  than  she  could  hold  us  to  her  em- 
pire in  1776.  The  mere  threat  of  her  displeasure  paralyzes  man- 
kind. 

The  most  instructive  point  of  all  is  that  our  great  majority  con- 
sists of  the  interests  in  the  world  which  have  been  from  time 
immemorial  reckoned  as  the  safest  and  most  conservative. 

The  whole  agricultural  class ;  the  whole  class  or  classes  of  small 
proprietors,  the  farmers  that  make  the  bulk  and  sinew  of  our  race  ; 
the  artisan  whose  interests  are  bound  up  in  the  success  of  our 
manufactures;  all  these  join  hands  with  what  is  left  of  their  old 
enemies,  the  landed  aristocracy  of  Europe,  to  protest  against  a 
revolution  made  for  the  benefit  of  the  money-lenders  alone. 

On  the  other  hand,  that  revolution  is  more  radical  than  any 
which  has  been  accomplished  by  professed  revolutionists.  Had  all 
the  despotic  governments  that  have  existed  in  a  thousand  years 
united  their  intelligence  to  set  class  against  class,  to  breed  corrup- 
tion, to  stimulate  violence,  and  to  shatter  the  foundations  of  society, 
they  could  have  invented  no  device  more  effective  than  this  decree, 
which  at  one  stroke  doubled  the  value  of  capital,  destroyed  the 
value  of  industry,  and  swept  the  small  proprietor  everywhere  into 
bankruptcy. 

The  whole  conservative  force  of  the  world  protests  against  so 
violent  and  despotic  a  change.  AVe  protest  against  it  the  more 
because  we  know  enough  of  politics  to  fear  the  reaction  against 
such  extravagance.  We  see  the  risk  to  which  the  gold  mania  is 
exposing  us.  We  have  reason  to  know  the  popular  feeling,  and 
we  do  not  believe  that  the  single  gold  standard  can  be  long  main- 
tained. We  want  real  money — coin — carrying  intrinsic  value  ;  yet 
if  England  succeeds  in  her  obstinate  effort  to  destroy  the  value  of 
silver  for  coinage,  nothing  can  save  us  from  paper.  England  may 
well  succeed;  she  seems  already  to  be  on  the  point  of  success 
greater  than  her  government  wanted ;  and  in  that  case,  irredeem- 
able paper  stares  us  squarely  in  the  face. 

THE    SITUATION    GROWS    GRADUALLY,    CONTINUOUSLY    WORSE. 

The  great  trouble  of  the  times  is  not  merely  the  depression  of 
prices,  but  their  continuing,  unceasing  fall.  This  fall  began  with 
wheat  and  cotton,  in  consequence  of  the  fall  of  silver  in  connec- 


SOUND  3I0XEY.  25 

tion  with  British  India  as  explained  in  my  former  letter.  The 
demonetization  of  the  white  metal  took  immediate  effect  on  agri- 
culture, American  agriculture  chiefly,  but  agriculture  in  Europe 
as  well.  This  continued  drop  in  prices  has  been  consequent  upon, 
and  is  mainly  due  to  the  great  monetary  changes  which  resulted  in 
the  abandonment  of  the  bimetalic  system,  under  which  the  entire 
business  of  the  world  was  carried  on  prior  to  1873.  In  order  to 
arrest  this  continuous  and  progressive  fall  it  is  necessary  to  revert 
to  the  system  which  prevailed  up  to  1873,  under  which  the  summit 
of  agricultural  and  industrial  prosperity  was  reached  and  main- 
tained not  only  in  the  United  States  but  throughout  Europe. 

The  most  alarming  feature  is  that  already  mentioned  of  its 
being  progressive,  no  one  being  able  to  foresee  where  it  is  to  end. 
If  we  could  foresee,  if  we  could  be  assured  that  prices  had  at  last 
touched  bottom  and  that,  low  as  they  are  now,  prices  would  re- 
main stable  and  steady  in  the  future,  then  it  might  be  possible  to 
conduct  our  agricultural  and  industrial  operations  on  a  business- 
like and  stable  basis.  Fresh  arrangements  could  be  made,  a  gen- 
eral adjustment  would  take  place  in  rent,  in  wages,  in  expenses 
and  in  all  outgoings,  and  business  would  go  on  as  before.  It  would 
be  a  terrible  state  of  things  and  it  would  entail  enormous  suffer- 
ing. The  present  generation  of  farmers  and  cultivators  would 
most  of  them  be  ruined  and  pass  away;  but  still,  if  once  you 
could  be  certain  that  prices  had  touched  bottom,  why,  then,  after 
a  general  readjustment,  industry  could  go  on  and  be  prosecuted 
in  the  future,  always  upon  the  condition  that  prices  had  reached 
their  lowest  level  and  could  be  counted  upon  to  remain  steady  in 
the  future.     But  that,  unhappily,  is  not  the  case. 

The  fall  of  prices  has  been  continuous  now  for  many  years,  and 
it  is  still  progressing.  In  order  to  see  this  we  have  only  to  look  at 
the  evideuce  of  what  is  known  as  the  system  of  index  numbers. 
Many  different  tables  of  prices  have  been  compiled  in  recent  years 
upon  this  system  by  a  number  of  eminent  men.  The  best  known 
of  them  are  the  tables  of  the  Economist  newspaper,  of  Dr.  Soetbier, 
of  Mr.  Giffen,  of  Dr.  Sauerbeck,  M.  Palgrave  and  others,  and 
they  all  show  very  much  the  same  result,  namely  :  That  the  prices 
of  commodities  generally  have  been  steadily  falling  now  for  many 
years.  The  latest  table  I  have  seen — that  of  Dr.  Sauerbeck — shows 
that  from  1873  to  1893  the  fall  has  been  rather  over  10  per  cent., 


26  SOUND  310 KEY. 

and  it  still  continues  in  1894.  Take  the  case  of  one  article  alone, 
of  wheat,  for  instance.  Xot  many  years  a«;o,  an  agricultural  asso- 
ciation  in  England,  alarmed  at  the  continual  fall  of  wheat,  sent 
over  to  the  United  States  two  highly  intelligent  commissioners  to 
report  upon  the  prospects  of  the  future  price  of  that  grain. 

The  two  gentlemen  went  back  and  reported  that  there  was  no 
likelihood  of  the  price  going  below  40  shillings  a  quarter  (eight 
bushels)  in  the  future,  that  being  equivalent  in  our  currency  to 
about  $1.20  a  bushel.  The  prediction  has  not  been  realized. 
Wheat  has  been  going  down  steadily  ever  since.  In  May  last  the 
following  was  one  of  the  commercial  announcements : 

"  Messrs.  Ralli  Bros,  sold  recently  red  Kurrachee  wheat,  May 
and  June  shipments,  to  Hull  at  19s.  3d.  per  492  pounds.  This 
was  superior  and  would  make  fair  average  quality  worth  only  18s. 
6cl.  Similar  quality  three  years  ago  would  be  worth  38  and  39s. 
a  quarter.  Mneteen  shillings  three  pence  is  the  lowest  price 
Messrs.  Ralli  Bros,  have  ever  sold  wheat  at."  This  is  equivalent 
to  about  53  cents  a  bushel,  and  the  fall  still  continues. 

THE    DISEASE    OF    PRICES    IS    NOT    OVERPRODUCTION. 

Some  wise  men  ascribe  this  continual  fall  to  overproduction, 
insisting  that  there  is  no  mystery  about  the  fall  at  all ;  that  the 
thing  is  very  simple ;  that  vast  areas  of  fertile  and  virgin  soil  are 
cultivated  now  in  all  parts  of  the  world  which  formerly  grew 
nothing ;  that  there  are  more  railways,  cheaper  freights,  and 
greater  facilities  of  transport  everywhere ;  and  that  all  that  we  are 
suffering  from  ma}T  be  summed  up  in  the  word,  "  overproduction." 
When  people  talk  of  overproduction,  they  always  seem  to  forget 
that  pari  passu  with  the  increase  of  commodities  there  has  been 
an  enormous  increase  also  in  the.  population,  and  in  the  needs  and 
requirements  of  the  world.  If  they  mean  by  overproduction  that 
the  ratio  of  the  increase  of  commodities  has  been  out  of  all  pro- 
portion to  the  increased  requirements  of  the  world,  why,  then,  I 
do  not  believe  them.  And  certainly  no  one  has  ever  given  the 
smallest  proof  of  that  very  common,  but  that  very  loose  and  vague 
assertion. 

Have  we  ever  considered  what  the  increase  of  the  population  of 
the  world  is  supposed  to  be  every  twenty  years  ?    I  saw  an  estimate 


SOUND  MONEY.  27 

upon  this  point  the  other  day.  According  to  that  estimate  the 
increase  in  the  population  of  the  world  every  twenty  years  amounted 
to  no  less  than  200,000,000  people,  and  rather  more;  10,000,000  a 
year.  Xow,  just  consider  what  that  means.  The  whole  popula- 
tion of  England  is  only  about  30,000,000,  and  therefore  it  is  much 
the  same  as  if  some  six  or  seven  new  Englands  had  been  added  to 
the  world  in  the  last  twenty  years.  And,  if  they  had  been,  what 
sort  of  increase  in  commodities  would  be  wanted  to  supply  them  ? 
But.  in  connection  with  this  subject,  the  tables  of  wheat  statis- 
tics show  the  total  yield  of  the  world's  wheat  crop  for  1891,  1892 
and  1893  to  have  been  304,000,000  quarters  for  1891,  300,000,000 
for  1892  and  288,000,000  for  1893,  showing  a  steady  decrease  in 
production.  What  the  English  call  a  quarter  of  grain  is  equal  to 
about  eight  bushels.  The  Liverpool  prices,  on  the  other  hand, 
were  41s.  per  quarter  for  1891,  29s.  for  1892,  and  25s.  for  1893, 
showing  an  enormous  fall  in  prices.  So  here  we  have  a  fall  in 
price  of  40  per  cent,  in  wheat,  in  spite  of  a  decrease  of  production 
and  in  spite  of  a  large  increase  in  population  and  demand.  In  the 
face  of  figures  such  as  these,  it  is  idle  to  talk  of  the  fall  in  prices 
being  due  to  nothing  but  overproduction.  Xo,  the  more  we  sift, 
and  the  more  closely  we  examine  into  this  question,  we  will  find 
that  there  is  only  one  thing  which  is  able  to  sufficiently  account 
for  the  enormous  and  unprecedented  change  which  has  occurred 
in  prices  during  the  last  twenty  years ;  and  that  is  the  change 
which  has  occurred,  not  in  production  nor  in  commodities,  but  in 
the  value  of  money  itself;  entirely  due  to  the  ojeat  monetary 
revolution  which  occurred  some  twentv  vears  as;o  in  our  country 
and  upon  the  continent  of  Europe,  and  to  the  abandonment  of  the 
bimetallic  system  by  which  it  was  accompanied  at  that  time. 

THERE    IS    NO    GOLD    TO    TAKE    THE  #PLACE    OF    THE    DISCARDED    SILVER. 

While  silver  depreciates  under  the  influences  that  I  have  abun- 
dantly described,  drao-^ino;  wheat  and  cotton  down  with  it,  and 
thereby  cheapening  correspondingly  all  material  property,  there 
is  no  hope  of  any  check  to  this  continual  fall  of  prices  from  any 
probable  increase  in  the  quantity  of  gold  in  use  in  the  form  of 
money  coins.  One  of  the  ablest  and  most  trusted  statisticians  of 
the  present  day  is  Professor  Edward  Suess.  of  the  University  of 
Vienna,  who  has  made  an  exhaustive  examination  of  the  facts  of 


28  SOUND  MONEY. 

the  production  of  silver  and  gold  in  the  world,  and  of  the  con- 
sumption of  these  metals.  He  concurs  with  Dr.  Soetbier,  an 
equally  distinguished  scientist,  in  saying  that  the  consumption  of 
gold  for  plate,  ornaments  and  use  in  the  arts,  is  now  about  equal 
to  the  annual  production,  with  a  prospect  of  becoming  greater, 
and  that  there  cannot  be  any  increase  hereafter  in  the  amount  of 
coined  gold  to  keep  pace  with  the  world's  growth  in  population 
and  trade ;  remarking :  "  We  have  already  reached  the  day,  or 
approached  very  close  to  it,  when  mining  will  yield  less  than  indus- 
try consumes. 

"  From  that  day  forward  the  whole  new  production  no  longer 
counts  for  monetary  needs,  and  from  that  day  forward  industry 
will  withdraw  from  the  stock  of  money  an  amount  of  gold  increas- 
ing annually  with  the  increase  of  well-being."  In  another  place, 
repeating  a  declaration  made  in  1877,  he  says  that  "  the  production 
of  gold  will  diminish  permanently  and  in  extraordinary  degree ; 
and  that  to-day,  even  more  distinctly  than  at  that  time,  events  are 
showing  that  this  metal,  with  constantly  increasing  rarity,  will  no 
longer  be  able  to  maintain  its  past  economic  position."  I  myself 
add  the  corollary.  Either  the  circulating  medium  of  the  world 
must  chiefly  consist  of  fiat  paper,  pure  and  simple,  or  it  must  be 
silver. 

MONOMETALISM    AN    INVENTION    AND    INNOVATION    OF    THE    LAST 

TWENTY-FIVE    YEARS. 

]STo  fact  in  economics  can  be  more  obvious  than  the  necessity  of 
a  return  to  the  policy  of  bimetalism.  There  are  a  good  many 
well-meaning  people  of  the  present  day  who  believe  that  bimetal- 
ism is  something  new;  but  it  is  as  old  as  the  history  of  mankind. 
Gold  and  silver  have  formed  the  joint  money  of  the  world  since 
the  earliest  ages  of  man ;  and  did  not  even  partially  cease,  that  is 
to  say,  did  not  cease  in  even  Europe  and  the  United  States,  until 
twenty  years  ago. 

What  is  bimetalism  ?  In  the  United  States  no  other  power 
than  the  federal  government  can  declare  what,  money  is,  and  by  so 
doing,  make  that  money  legal  tender  for  the  payment  of  debts 
between  man  and  man.  Generally,  the  government  declares 
nothing  but  gold  and  silver  coins,  accurately  described,  to  be  legal 


SOUND  MONEY.  29 

tender  money.  In  rare  emergencies  it  resorts  to  be  expedient  of 
declaring  its  own  treasury  notes — greenbacks — to  be  legal  tender, 
but  this  is  seldom  done.  Gold  and  silver  coins  are  in  general  the 
only  legal  tender  money.  It  is  not  all  such  coins,  however,  that 
are  made  legal  tender. 

The  government  imparts  this  function  only  to  coins  struck  at  its 
mints.  A  private  citizen  may  manufacture  a  gold  or  a  silver  coin 
precisely  like  that  issued  from  the  mints  in  weight  and  fineness ; 
and  yet  that  coin  would  not  be  money ;  it  would  be  only  merchan- 
dize, and  would  bring  in  the  market  only  what  the  same  weight  of 
metal  is  worth  there. 

These  coins  of  the  mint,  therefore,  have  an  attribute  imparted 
to  them  by  law,  varying  them  from  the  material  of  which  they  are 
composed.  That  is  to  say,  they  have  the  legal  tender  attribute ; 
it  is  the  fiat  of  the  law  which  gives  them  a  value  different  from 
that  which  the  metal  of  which  they  are  composed  possesses.  This 
difference  is  generally  very  small,  the  intrinsic  or  market  value  of 
the  metal  in  the  silver  and  gold  coins  being  very  nearly  the  same 
as  its  money  value.  Of  late,  however,  since  Great  Britiain  suc- 
ceeded in  procuring  the  demonetization  of  silver  in  this  country, 
and  thereby  bringing  about  a  heavy  depreciation  of  that  metal  in 
Europe  and  the  United  States,  silver  as  a  commodity  is  worth 
much  less  than  our  legal  silver  coins.  The  fiat  of  law  makes  the 
American  dollar  worth  100  cents,  while  the  cunning  of  John  Bull 
has  made  the  same  quantity  of  metal  worth  but  little  over  half  the 
money  value. 

Mr.  Bull's  first  success  was  very  signal.  Our  mint  act  of  1873, 
whose  passage  he  secured,  demonetized  not  only  silver  bullion  by 
denying  to  it  the  privilege  of  the  mints;  but  reduced  our  silver 
coins  to  bullion  value  by  providing  that  those  for  less  than  a  dollar 
should  not  be  legal  tender  for  greater  payments  than  $5  ;  and  by 
actually  divesting  the  dollar  coins  of  power  to  pay  any  debts  what- 
ever. Five  years  afterwards,  however,  the  Bland  act  managed  to 
get  through  Congress,  by  which  the  American  dollar,  the  silver 
dollar  of  our  own  mints,  was  re-invested  with  the  le^al  tender 
function. 

WHAT    BIMETALISM    IS    AND    WAS. 

So  much  for  our  silver  coins  already  minted  and  most  of  them 


30  SOUXD  MONEY. 

in  circulation.  Nevertheless,  silver  itself  is  still  demonetized  in 
the  United  States.  The  law  of  the  land  so  provides,  that  if  gold 
is  taken  to  our  mints  they  are  bound  to  receive  it  from  any  person 
whatever  in  any  quantity,  and  to  return  it  to  the  owner  coined  at 
the  rate  of  25  8-10  grains  to  the  dollar  free  of  charge.  The  result 
is  practically  all  the  gold  of  the  country,  not  used  in  the  arts,  is 
converted  into  money  coins  having  the  legal  tender  function. 
Another  effect  is  to  make  all  gold  in  the  country,  whether  coined 
or  not,  worth  its  money  value. 

The  case  was  the  same  in  regard  to  silver  until  twenty  years 
ago.  Everv  and  any  owner  of  the  metal  could  take  it  to  one  of 
the  Federal  mints  and  it  would  be  coined  at  the  rate  of  41 2 1  grains 
tu  the  dollar  and  returned  to  the  owner  in  the  form  of  coins  with- 
out charge.  The  operation  of  this  law  was  to  make  all  silver  in 
the  country  worth  its  coin  value.  Until  this  privilege  of  the  mints 
was  denied  to  silver,  our  laws  of  coinage  and  legal  tender  held 
gold  and  silver  to  an  exact  unvarying  parity  of  value,  at  the  ratio 
of  412^  to  25  8-10,  or  16  to  1.  These  laws  giving  equality  of  privi- 
lege in  the  mints  to  the  two  metals  had  existed  here  since  our 
government  was  formed,  and  in  Europe  for  a  hundred,  nay  for 
hundreds  of  years,  holding  gold  and  silver  to  the  legal  tender 
parity  of  16  to  1  in  this  country,  \b\  to  1  in  Europe,  and  15  to  1 
in  Asia;  with  so  little  variation  as  to  be  inappreciable,  always 
more  in  favor  of  silver  than  of  gold.  There  was  never  complaint 
of  any  serious  variations  of  either  metal  from  these  relative  values. 
Under  the  influence  of  mintage  and  coinage  laws  the  parity  was 
maintained  automatically  in  three  continents.  There  was  never 
complaint,  and  the  unfailing  steadiness  of  this  parity  was  one  of 
the  greatest  blessings  to  the  world  ever  resulting  from  the  wisdom 
and  honesty  of  man. 

Since  1873,  alas,  all  this  has  been  changed.  Silver  has  been 
boycotted;  the  mints  of  the  government  have  been  closed  to  it; 
it  has  been  steadily  and  continually  going  down  in  value,  dragging 
down  with  it  the  prices  of  all  sorts  of  material  property.  Bimetal- 
ism  was  discarded.  Monometalism  was  enthroned — the  Iliad  of 
incalculable  woes  to  mankind. 

INSANITY    OF    THE    FEAR    OF    TOO    MUCH    SILVER. 

There  is  but  one  remedy  for  the  universal  troubles,  mercantile 


Sound  money,  31 

and  financial.  It  consists  in  a  return  to  the  policy  of  centuries 
anterior  to  the  accursed  year  1873 — in  a  return  to  bimetalism. 
I  shall  now  consider  the  stock  objections,  the  sterotyped  pre- 
tenses that  are  urged  against  this  return.     It  is  insisted  that  the 

CD  CD 

amount  of  silver  annually  produced  is  so  great  as  to  render  its 
appreciation  to  its  former  value  impossible,  even  under  mintage, 
coinage  and  legal  tender  laws  passed  for  that  object. 

Well,  the  production  is  about  8175,000,000  worth  a  year  at  par 
estimation.  The  production  of  gold  is  about  $165,000,000  worth. 
We  have  already  seen  that  the  stock  of  s^old  mouev  in  the  world 

*/  CD  l 

in  the  form  of  coins  cannot  be  expected  to  increase  hereafter.  So 
that  the  only  possible  increase  in  the  metalic  money  stock  must 
hereafter  come  from  silver,  for  a  number  of  years  the  silver  pro- 
duction per  annum  has  been  materially  increased ;  but  not  incom- 
mensurately  with  the  increasing  wants  of  the  growing  population, 
trade  and  wealth  of  nations.  The  consumption  annually  of  this 
product  in  ornaments  and  in  the  arts  has,  like  that  of  gold,  in- 
creased in  greater  proportion  than  that  of  production,  and  the  sur- 
plus left  for  monev  is  not  lar^e  enough  to  frighten  the  most  timid 

L  %J  »_  CD  CD 

economist ;  is  not  large  enough,  if  silver  were  remonetized,  to 
produce  money  enough  for  general  use.  The  production  might 
increase  beyond  all  past  experience,  and  still  the  increase  be  neces- 
sarv  to  the  arrowing  needs  of  mankind. 

%>  CD  O 

But  the  real  question,  the  over-ruling  factor  in  the  case,  is  not 
what  is  the  annual  production  of  this  metal  or  of  the  two  precious 
metals,  but  what  is  the  total  mass  of  each  of  them  already  in  exis- 
tence ?  The  celebrated  report  to  the  British  Parliament  of  the 
gold  and  silver  commission  which  was  appointed  by  that  body  a 
few  years  ago,  gave  us  valuable  information  on  that  subject. 
There  the  estimate  of  the  mass  of  gold  in  existence  in  the  world, 
five  years  ago,  was  87,750,000,000,  or  in  round  numbers,  88,000,- 
000,000 — eight  thousand  millions  of  dollars'  worth.  Silver,  on 
the  other  hand,  was  estimated  at  a  little  under  810,000,000,000— 
ten  thousand  millions  of  dollars'  worth.  Suppose,  therefore,  that 
the  silver  product  not  annually  consumed  in  the  arts  and  in  plate 
and  ornaments  were  as  much  as  875,000,000  a  year.  What  is  sev- 
enty-five in  ten  thousand  ?  It  is  only  three-quarters  of  1  per  cent., 
and  it  is  a  very  big  coward  who  would  be  scared  at  such  an  incre- 
ment. 


32  SOUND  3I0XEY. 

The  money  metals  are  chosen  as  such  because  of  their  quality 
of  indestructibility  from  rust  and  minimum  loss  from  abrasion. 
They  do  not  perish  and  are  not  annually  consumed.  A  crop  ot 
wheat  is  consumed  every  year.  A  great  increase  or  decrease  in 
the  annual  crop  of  any  cereal  makes  a  question  of  plenty  or  famine. 
But  the  mass  of  gold  and  silver  is  the  accumulation  of  centuries. 
Some  of  the  gold  now  in  use,  however  often  it  may  have  been  re- 
coined,  existed  probably  in  the  days  of  Solomon  or  even  the  Pha- 
raohs, and  the  annual  additions  to  the  enormous  mass  are  com- 
paratively unimportant.  The  greater  the  increase  of  both  metals 
the  better.  Let  the  fellows  that  dread  a  plethora  of  silver  go  to 
bed,  cover  up  their  heads,  and  the  imaginary  ghost  will  pass  them 
by,  blessing  instead  of  harming  them  in  their  dreams. 

A    CHANGE    OF    THE    RATIO    IMPRACTICABLE    AND    USELESS. 

Another  imaginary  trouble  is  in  fixing  upon  the  ratio  of  the 
two  metals.  Men  who  have  been  good  bimetalists,  but  have  been 
hypnotized  by  the  monied  Octopus,  insist  upon  an  international 
agreement  on  the  question  of  the  ratio.  The  demand  is  a  pretense. 
There  cannot  be  any  change  of  the  old  ratio.  All  the  silver  coins 
in  the  United  States,  Europe,  and  the  greater  part  of  Asia,  have 
been  coined  on. that  ratio;  and  a  change  would  require  the  recoin- 
age  of  possibly  a  thousand  millions  of  dollars'  worth  of  existing 
silver  coins.  The  task  would  be  as  useless  as  it  would  be  costly, 
if  practicable.  It  is  not  to  be  thought  of.  If  practicable,  it  would 
be  inexpedient.  The  American  gold  dollar  is  already  too  small. 
All  of  those  which  go  to  Europe  are  melted  down  and  recoined 
into  European  mone}'.  Even  our  quarter  eagles  are  already  too 
small.  They  are  easily  confounded  in  the  dark  with  ten-cent  sil- 
ver pieces.  On  the  other  hand,  the  silver  dollar  is  full  large 
enough  already.  So  is  the  silver  half-dollar  and  quarter-dollar. 
Any  increase  of  size  in  our  principal  silver  coins  would  make 
them  too  large  ;  they  must  remain  as  they  are. 

I^o,  the  ratio  must  remain  unaltered.  Each  nation  must  let  the 
laws  affecting  it  stand  as  they  are,  and  as  they  have  stood  practi- 
cally for  centuries.  If  the  United  States,  in  re-monetizing  silver, 
so  determine,  the  other  nations  will  be  obliged  to  follow  suit ; 
France  will  do  so  with  cheerful  alacrity ;  and  these  two  powers 


SOUND  MONEY.  33 

control  the  question.     The  difficulty  of  fixing  a  ratio  is  imaginary. 
Let  it  be  relegated  to  the  limbo  of  false  clamors. 

THE    TERRORS    OF    A    PURELY   IMAGINARY    DUMPING. 

Finally,  there  comes  the  "  dumping"  objection,  but  the  "  dump- 
ers "  are  a  rather  silly  lot.  The  course  of  the  silver  stream  is  this  : 
It  rises  in  America,  flows  through  Europe,  and  debouches  into  the 
ocean  of  Asiatic  populations.  Nothing  flows  up  stream,  and  the 
current  of  silver  is  not  an  exception  to  the  general  rule. 

In  America,  where  it  is  produced,  the  ratio  of  silver  to  gold  is 
16  to  1 5  that  is  to  say,  it  takes  sixteen  times  its  weight  in  silver  to 
be  equal  here  to  a  dollar  of  gold.  In  Europe  it  takes  only  15|  times 
that  weight.  In  India  it  takes  still  less,  only  15  times  as  much. 
There  is  no  natural  tendency,  therefore,  of  silver  to  flow  either 
from  Europe  or  India  hitherward,  and  to  dump  itself  here.  The 
mathematics  of  the  dumping  apprehension  is  very  bad. 

The  silver  of  Europe,  as  before  indicated,  is  coined  on  the  ratio 
of  15 J  to  1 ;  whereas  American  coinage  is  on  the  ratio  of  16  to  1 ; 
and  as  the  bulk  of  European  silver  has  been  in  use  a  great  many 
years,  it  has  probably  lost  an  average  of  3  per  cent,  by  abrasion. 
Here  is  a  dead  loss  of  6  per  cent,  on  every  dollar's  worth  of  Euro- 
pean silver  if  clumped  in  this  country,  to  which  must  be  added 
freight  and  insurance.  But  this  is  not  all  that  is  to  be  said.  The 
European  coins  could  not  be  offered  to  our  mints.  The  one-tenth 
alloy  which  they  contain  would  have  to  be  extracted — a  loss  of  10 
per  cent. — and  the  extraction  would  cost  another  5  per  cent.,  mak- 
ing a  loss  and  cost  of  not  less  than  22  cents  before  the  dump  could 
reach  our  mints,  the  total  loss  on  every  dollar's  worth  of  European 
silver  brought  over  here  being  not  less  than  32  cents.  Foreign 
Speculators  would  have  to  sell  for  68  cents  the  silver  which  cost 
them  in  Europe  a  dollar  in  gold. 

In  India  the  ratio  is  15  to  1,  and  an  ounce  of  silver  there  is 
equal  to  1  37-100  in  gold  ;  so  that  a  dollar  there  would  contain 
348^  grains  of  pure  silver,  against  359  91-100  grains  in  Europe, 
and  371|  grains  of  pure  silver  in  the  American  dollar  of  412J 
grains  of  alloyed  metal.  Hence,  to  send  silver  from  India  here 
would  cause  a  loss  of  8  cents  an  ounce.     The  dumping  fright  is 


34  SOUND  M ONE Y. 

therefore  over  a  bug-a-boo ;  and  the  whole  enquiry  is  as  idle  as  it 
would  be  to  consider  what  would  happen  if  rain  should  fall  from 
the  earth  to  the  skies,  or  if  the  James  river  should  reverse  its 
course  and  flow  up  to  Glasgow. 

I  have  said  enough  to  show  that  a  return  to  the  policy  of  bi- 
metalism  is  inevitable,  The  only  question  is,  when  will  the  return 
take  place  ?  Shall  it  be  deferred,  as  M.  Cernuschi  believes  it  will 
be,  until  after  a  general  cateclysm  in  prices  and  property;  until 
the  masses  of  mankind  are  reduced  to  pauperism ;  until  civil  revo- 
lution is  muttering  its  thunders  all  around  the  horizon;  until 
socialism  takes  root  in  every  community;  until  anarchism  has 
recruited  an  army,  unfurled  its  flag  and  planted  its  assassins  in 
every  capital  city  of  the  civilized  world ;  or  shall  the  effective 
remedy  be  applied  before  such  calamities  have  fallen  upon  the 
nations  of  the  earth  ?  That  is  the  present  form  of  the  question  of 
bimetal  ism. 

The  United  States,  acting  alone,  can  give  relief  to  the  world  by 
re-establishing  the  financial  policy  of  the  fathers,  and  undoing  the 
detestable  fraud  of  1873.     Ho  !  for  the  blessed  year  1896. 


The  Disfranchisement  of  the  Money  of  the  People, 


Norfolk,  Va.,  December  2d,  1891. 

To  the  Editor  of  the  Norfolk  Pilot : 

The  currency  platforms  of  the  two  great  political  parties  of 
the  country  in  1892  were  substantially  the  same.  Both  were  bad 
enough,  but  the  Democratic  was  worse  than  the  other.  They  were 
deceptive.  The  conventions  which  adopted  them  were  honest,  but 
were  victims,  not  authors,  of  the  deception. 

The  fundholders  of  Lombard  Street,  through  the  Tories  of  Wall 
Street,  devised  these  platforms.  That  of  the  Democrats  was  this : 
"  We  hold  to  the  use  of  both  gold  and  silver  as  the  standard 
money  of  the  country,  and  to  the  coinage  of  both  gold  and  silver 
without  discriminating  against  either  metal,  or  charge  for  min- 
tage."    This  was  the  true  American  part  of  the  plank. 

To  it  was  appended  this  Tory  clause :  "  But  the  dollar  unit  of 
coinage  of  both  metals  must  be  of  equal  intrinsic  and  exchangea- 
ble value,  or  be  adjusted  through  international  agreement,  or  by 
such  safeguards  of  legislation  as  shall  insure  the  maintenance  of 
the  parity  of  the  two  metals,"  etc.,  etc. 

In  the  vulgar  parlance  of  present  times,  we  have  a  recently 
adopted  word,  faque,  which  means  some  mountebank  trick,  artful 
dodge  or  false  pretense.  The  Tory  clause  of  the  party  platforms 
contains  two  faques.  The  first  is  this  :  The  clause  makes  the  res- 
olution read  substantially :  "  We  demand  the  free  and  equal  coin- 
age of  gold  and  silver  in  our  mints  free  of  charge,  provided  that 
Great  Britain  gives  us  leave  to  do  so  in  the  form  of  an  interna- 
tional agreement  to  which  she  shall  be  a  party."  And  Great  Brit- 
ain is  predetermined  not  to  give  us  leave. 

There  can  be  no  international  agreements  without  international 
conference.  So  that,  first,  you  must  get  a  conference ;  and  then 
you  must  get  an  agreement.  Mr.  Harrison  tried  the  expedient  of 
a  conference.     Great  Britain  allowed  him   to  call  it.     She  took 


36  SOUND  MONEY. 

good  care  to  be  at  Brussels  in  1893  with  her  delegates.  Whoever 
will  take  the  trouble  to  read  the  proceedings  of  that  body  will  be 
able  to  arrive  at  but  one  conclusion  ;  which  is,  that  it  was  Great 
Britain  who  broke  up  the  conference  at  Brussels.  That  opinion 
is  confirmed  by  what  has  since  happened.  Germany  was  supposed 
to  be  the  greatest  obstacle;  but  the  popular  opinion  of  Germany 
is  now  strongly  in  favor  of  bimetalism.  Count  Caprivi  was  re- 
proached in  the  German  parliament  last  December  for  the  conduct 
of  the  German  delegates  at  Brussels.  What  was  his  reply  ?  He 
said  that  "  the  government,  seeing  that  the  conference  was  doomed 
to  failure  had  been  unwilling  to  entangle  German}7  in  a  fiasco." 
And  why  was  it  doomed  to  failure  ?  He  went  on  to  say,  "  With- 
out Great  Britain,  nothing  could  be  done,  and  under  the  present 
prime  minister  (Gladstone)  there  was  no  chance  of  anj'thing  being 
attempted." 

Since  then,  during  the  present  year,  Germany  has  appointed  a 
commission  of  her  own.  France  is  now,  as  she  has  always  been, 
bimetalic ;  and  President  Cleveland  has  asked  and  has  obtained 
from  Congress  general  powers  to  summon  another  international 
conference  whenever  he  pleases.  He,  however,  has  never  yet  ex- 
ercised these  powers;  being  interdicted  by  the  Tories  of  Wall 
street,  at  the  command  of  England ;  who  is  the  great  impediment 
to  a  glad  return  of  the  nations  to  the  bimetalic  policy. 

Great  Britain  contrived  to  have  inserted  in  the  national  platform 
of  both  our  great  political  parties,  in  1892,  a  clause  practically 
requiring  her  consent  to  the  free  coinage  of  both  the  precious 
metals  in  our  mints.  And  that  is  the  situation.  That  is  the 
"condition  which  confronts"  Mr.  Cleveland.  He  must  account 
in  his  coming  message  for  his  failure,  obediently  to  the  behest  of 
his  party,  for  nearly  two  }rears,  to  call  an  international  conference ; 
and  if  he  is  candid  with  the  country,  he  will  say  that  his  reason  is 
the  same  as  that  of  Germany;  that  England,  by  her  diplomacy, 
interdicts  it.  He  ought  to  proclaim  that  the  time  has  come  for 
another  "  Declaration  of  Independence;  "  but  I  have  no  hope  that 
he  will  do  so.  The  same  malign  influences  which  inserted  the 
Tory  clause  in  the  Democratic  and  Republican  platforms  of  1892 
dictated  the  nominations  of  Harrison  and  Cleveland;  and  they 
were  sure  of  their  man,  whichever  one  might  be  elected.  Are  we 
a  free  people  ?     Echo  answers,  free  people  ?     Free  people ! ! ! 


SOUND  MONEY.  37 

In  refreshing  contrast  with  the  tory  clause  in  the  party  platforms 
which  I  have  given,  I  insert  an  utterance  having  the  true  Ameri- 
can ring.  It  is  the  leading  resolution  of  the  American  Bimetalic 
League,  just  adjourned  at  St.  Louis  : 

"  Whereas  it  is  an  indisputable  fact,  that  the  monetary  revolution  inaugurated 
in  1873,  by  changing  the  money  standard  from  gold  and  silver  to  gold  alone,  has 
resulted,  in  twenty  years,  in  doubling  the  value  of  money  and  reducing  the  gene- 
ral level  of  prices  50  per  cent. ;  therefore  this  conference  calls  upon  the  advocates 
of  monetary  reform  everywhere  to  make  monetary  reform  the  paramount  issue, 
and  to  vote  for  no  candidate  who  is  not  in  favor  of  the  free  coinage  of  both  gold 
and  silver  at  the  ratio  of  16  to  1,  as  it  existed  in  this  country  from  the  foundation 
of  the  government,  and  for  indefinite  ages  throughout  the  civilized  world  until 
1873.  Americans  must  act  for  America,  independently  of  what  other  nations 
may  do  or  may  not  do." 

For  one,  I  agree  with  the  American  bimetalic  league.  For  one, 
speaking,  I  trust,  in  the  spirit  of  an  American  patriot,  I  declare 
that  I  would  rather  have  free  coinage  in  our  American  mints 
without  the  permission  of  Great  Britian  than  with  it ;  without 
international  agreement  than  with  it. 

The  other  faque  in  the  Tory  clause  of  the  party  platforms  is 
this :  The  parity  of  the  white  metal  with  the  gold  was  destroyed 
by  denying  to  it  the  privilege  of  the  mints;  and  the  metal,  as 
metal,  cannot  regain  that  parity  until  the  privilege  of  the  mints  is 
restored  to  it.  Lombard  and  Wall  streets  well  knew  this  fact; 
and  yet  they  made  both  of  our  great  political  parties  put  the  cart 
before  the  horse,  and  demand  that  the  privilege  of  the  mints 
should  not  be  restored  to  the  silver  metal  until  it  had  beforehand 
regained  its  parity  with  gold,  the  bankers'  money,  which  alone 
enjoyed  it.     The  faque  is  transparent. 

Distinguished  and  trusted  statisticians  show  that  the  debts  of 
the  civilized  world,  public  and  private,  aggregate  in  amount 
betweeen  one  hundred  thousand,  and  one  hundred  and  fifty  thous- 
and millions  of  dollars.  It  requires  the  use  of  all  the  gold  and 
silver  in  the  world  available  for  money  so  to  manipulate  these 
debts  of  mankind  as  to  make  them  an  easy  burden  to  the  popula- 
tions on  which  they  rest. 

Gold  and  silver  are  made  available  for  this  benign  and  necessary 
purpose  by  two  expedients  ;  namely,  by  legal  tender  laws,  and  by 
being  officially  coined  at  a  parity  fixed  by  coinage  laws.     Neither 


38  SOUND  MONEY. 

metal  can  perform  the  functions  of  money  unless  made  legal  ten- 
der, and  unless  fixed  in  relative  parity  by  official  coinage,  in 
conformity  with   well-digested   coinage   laws. 

If  either  metal  is  deprived  of  the  privilege  of  official  coinage, 
it  ceases  to  be  money,  and  at  once  loses  its  parity  with  other  metal. 
But  restore  that  parity,  and  such  is  the  need  for  it  as  a  means 
of  manipulating  the  vast,  innumerable,  and  multiform  debts  of 
mankind,  that  it  immediately  leaps  to  parity,  and  retains  it,  as 
before  1878,  fixed  unchangeably. 

I  will  stop  here,  for  a  moment,  to  consider  why,  until  1873,  silver 
always  maintained,  and  often  more  than  maintained,  its  parity 
with  gold. 

An  old  stock  argument  is  this  :  "  You  cannot  retain  a  fixed 
ratio  between  gold  and  silver  any  more  than  you  can  between  any 
other  two  commodities.  You  cannot  interfere  with  the  laws  of 
supply  and  demand.  The  thing  is  impracticable."  This  is  abso- 
lutely true ;  but  those  who  so  insist  appear  to  be  ignorant  of  what 
is  perhaps  the  most  elementary  fact  of  our  contention,  viz :  that 
the  bimetalic  theory  affords  the  most  perfect  and  most  striking 
instance  of  the  operation  of  this  law;  and  I  believe  I  am  right  in 
saying  that  that  is  the  opinion  of  every  protessional  teacher  of 
political  economy  in  England  at  the  present  time,  who  are  all 
bimetalists.  What  we  say  is  this,  that  the  law  can  enact  that  either 
or  both  of  the  metals  shall  be  legal  tender  for  debt.  That  we 
know,  because  it  has  been  done  effectually  for  ages.  And  thereby 
the  law  creates  what  is  and  what  has  been  the  chief  demand  for 
the  precious  metals,  namely,  for  the  purposes  of  mone3T.  The  law 
can  also  enact  that  they  shall  be  legal  tender  at  a  given  ratio  be- 
tween the  two ;  for  this,  also,  has  been  done,  and  done  effectively, 
in  all  the  past.  ~Now  comes  the  question,  how  is  the  ratio  main- 
tained ?  The  answer  is,  that  debtors  always  try  to  pay  their  debts 
in  the  cheapest  way  they  can ;  that  is  to  say,  in  whichever  metal 
is  cheapest.  What  do  these  debts  amount  to  ?  I  have  already 
said  that  the  aggregate  amount  of  the  debts  of  the  world  is  esti- 
mated at  something  between  one  hundred,  and  one  hundred  and 
fifty,  thousand  millions  of  dollars.  Consequently,  if  either  metal 
falls,  for  any  reason,  below  the  legal  ratio,  there  will  be  an  imme- 
diate increase  in  the  demand  upon  it  for  the  purpose  of  the  pay- 
ment of  debts.     The  increased  demand  produces  its  natural  effect. 


SOUND  31  ONE Y.  39 

The  metal  which  has  shown  the  tendency  to  fall,  returns  under 
the  demand  to  the  normal,  or  rather,  I  should  say,  the  legal  level. 
Formerly  it  was  gold  (at  the  time  of  the  gold  discoveries  forty 
years  ago).  More  recently  it  has  been  silver,  the  production  of 
which  of  late  has  much  increased,  although  in  nothing  like  the 
same  proportion  as  the  production  of  gold  increased  in  former 
days. 

And  in  this  way  an  automatic  action  is  set  up,  which  not  only 
keeps  the  relative  value  of  the  metals  steady,  but  makes  it  impos- 
sible for  them  to  vary,  except  within  the  smallest  limits.  If  a 
great  increase  in  either  metal  should  occur  and  begin  to  have  the 
least  effect,  the  parity  is  immediately  restored  by  the  operation  of 
the  natural  law.  And  this  explains  at  once  the  practical  stability 
of  the  ratio  during  the  long  periods  antecedent  to  1873,  when  the 
variation  in  the  production  of  the  metals  was  infinitely  greater 
than  it  has  ever  been  since  then.  I  feel  that  I  ought  to  apologize 
for  repeating  this  fundamental  argument  in  replying  to  the  anti- 
quated objections  with  which  we  are  assailed. 

But  the  wholesome  operation  of  this  great  law  of  supply  and  de- 
mand loses  its  power  to  maintain  the  equilibrium  described,  when 
either  of  the  metals  is  denied  the  free  use  of  the  mints,  the  unre- 
stricted benefit  of  legal  tender  laws,  and  the  impartial  use  of  them 
by  government,  in  public  receipts  and  disbursements.  All  this  is  so 
plain  that  one  distinguished  economic  writer  has  said  that  none 
but  dunces  will  stickle  for  intrinsic  value  in  the  money  metals, 
except  rascals. 

Free  coinage  of  both  metals  is  therefore  essential  to  the  restora- 
tion of  this  parity :  and  the  best  way  of  restoring  free  coinage  to 
silver,  is  to  restore  it. 

Some  half  a  century  ago  or  less,  after  there  had  been  a  long 
suspension  of  specie  payments,  the  country  resolved  to  decree  a 
general  resumption  by  the  treasury  and  the  banks.  There  at  once 
arose  a  wild  babel  of  advice  in  regard  to  silver  reserves,  gold  re- 
serves, how  the  swollen  volume  of  floating  notes  should  be  cor- 
ralled, and  how  the  hysterical  banks  should  escape  the  gorgons, 
hydras  and  chimeras  dire,  which  they  saw  infesting  the  path  of 
resumption.  At  last  a  doughty  old  man  by  the  name  of  Horace 
Greely,  who  professed  to  know  nothing  about  finance,  and  who  had 
become  wearied  with  the  palaver  of  bankers,  wise  and  otherwise, 


40  SOUND  MONEY. 

astounded  the  clamoring  tribe  and  comforted  the  country,  one 
morning,  by  proclaiming  that  "  the  best  way  of  resuming  specie 
payments  was  to  resume."  His  advice  was  adopted.  "Resumption 
immediately  took  place.  Resumption  was  accomplished,  despite 
of  the  bankers  and  to  the  dismay  of  the  faquers — by  resuming. 

Important  as  that  question  was,  it  sinks  into  insignificance  in 
comparison  with  the  question  of  restoring  to  silver  metal  the  priv- 
ilege of  the  mints,  and  allowing  it  to  perform  its  God-given  func- 
tion of  rendering  easy  and  facile  to  mankind  the  burden  of  the 
debts  amounting  to  a  hundred  thousand  millions  of  dollars  which 
rest  upon  their  stalwart  shoulders.  Xot  to  restore  this  privilege 
to  this  metal  is  to  commit  a  fearful  crime  against  humanity. 

Mr.  Cleveland  will  doubtless  say  a  good  deal  about  a  debased 
currency,  in  reference  to  our  silver  coins.  In  America  we  are 
totally  unfamiliar  with  base  coins.  The  laws  allow  any  man  who 
has  coins  that  have  become  worn  and  light  of  weight  to  return 
them  to  the  mint  and  to  receive  their  nominal  equivalent  in  new, 
full-weight  coins  in  exchange.  This  privilege  was  unknown  in 
England  in  former  times ;  and  that  country  was  full  of  abraded 
coins  (chiefly  silver,  because  they  were  the  money  of  the  popu- 
lace) to  such  an  extent  that  a  "  slick  shilling  "  was  a  term  of  abom- 
ination. The  worn  coins  became  a  public  curse,  and  Macauley 
graphically  describes  the  evil  of  them  in  one  of  his  essays.  But 
such  coins  are  unknown  in  our  country.  No  others  have  circula- 
tion amongst  us  than  those  struck  bv  our  mints,  and  these  coins 
are  worth  full  par  by  the  legal  tender  and  coinage  laws  of  our 
country.  Therefore,  to  reprobate  these  coins  as  base  is  to  denounce 
the  law  of  the  land  as  sanctioning  a  fraud ;  and  such  denunciation 
would  not  be  entirely  becoming  in  the  chief  executor  of  those 
laws. 

But  if  the  metal  in  our  silver  coins  is  not  worth,  as  metal  in  the 
market,  the  value  which  the  law  of  the  land  gives  it  in  the  form 
of  coins,  everyone  knows  that  this  result  has  been  superinduced 
by  the  grossest  fraud  ever  perpetrated  since  gold  and  silver  coins, 
stricken  by  national  mints,  became  the  money  of  civilized  nations. 

In  all  our  ante-'73  history,  silver  not  only  held  its  parity  with 
gold  at  16  to  1,  but  was  always  more  or  less  above  par,  in  conse- 
quence of  its  being  the  favorite  money  of  the  people,  much  more 
largely  and  continually  used  in  transactions  between  man  and  man, 


SOUND  MONEY.  41 

than  gold,  the  money  of  bankers  and  of  their  vaults.  It  was  the 
fraud  of  1873  that  depreciated  silver,  and  it  is  the  perpetrators  of 
that  fraud  sent  over  from  Lombard  Street,  and  their  American 
leash  hounds,  that  are  now  in  hue  and  cry  after  the  American  dol- 
lar as  a  "base  coin." 

There  can  be  no  doubt  of  the  fact  that  the  great  body  of  the 
voters  of  the  Democratic  party  are  bimetalic.  There  is  just  as 
little  doubt  that  Mr.  Cleveland  is  violentlv  monometalic.  His 
policy  against  silver  has  been  extreme.  He  forced  the  repeal  of 
the  Sherman  act,  by  which  repeal  the  treasury  was  required  to 
suspend  its  purchase  and  coinage  of  the  surplus  silver  of  our  mines 
to  the  amount  of  §54,000,000  a  year,  and  issuing  for  it  the  same 
amount  of  greenbacks;  thus  painfully  restricting  the  currency. 

His  policy  of  borrowing  gold  on  new  issues  of  government 
bonds,  for  the  purpose  of  paying  maturing  paper  obligations  of 
the  government  in  that  metal,  rather  than  in  silver,  is  in  the  same 
line.  His  fad  is  to  maintain  inviolate  a  gold  reserve  of  a  hundred 
millions  of  dollars.  He  has  erected  his  reserve  into  a  juggernaut 
before  which  all  other  interests  must  bend  obeisance,  and  under 
whose  remorseless  wheels  every  opposing  interest  must  be  crushed. 

The  law,  and  the  tenor  of  the  bonds,  make  these  obligations  of 
the  government  payable  in  coin,  but  silver  coins  are  ignored  and 
degraded,  and  gold  coins  only  employed  in  the  payments.  It  is 
an  ominous  sign  that  John  Sherman  is  in  daily  conference  with 
Mr.  Cleveland  about  the  forthcoming  message. 

The  result  is:  Mr.  Cleveland  will  have  to  recommend  in  that 
paper  the  withdrawal  and  final  destruction  of  the  entire  greenback 
circulation  of  the  country,  now  amounting  to  §346,000,000.  They 
are  payable  in  coin,  and  although  they  are  the  most  popular  money 
ever  enjoyed  by  the  people  of  the  United  States,  and  are  never,  by 
the  people,  presented  for  redemption,  yet  in  the  hands  of  the 
bankers  they  are  a  perpetual  menace  to  the  hundred  million  gold 
reserve,  our  monometalic  Juggernaut,  and  must  therefore  be  re- 
tired. 

Obliged  to  make  this  recommendation,  it  must  follow  that  Mr. 
Cleveland  must  recommend  the  substitution  of  bank  notes  in  the 
place  of  the  greenbacks,  and  suggest  some  such  scheme  of  banking 
as  the  Octopus  blocked  out  in  Baltimore  the  other  day.      Govern- 


42  SOUND  MONEY. 

merit  bonds  will  be  the  basis  of. the  new  bank  circulation,  and,  as 
a  sop  to  Cerberus,  it  will  be  recommended  that  a  certain  percen- 
tage of  the  silver  coins  shall  constitute  a  part  of  the  reserves  of 
the  banks  issuing  the  new  currency.  Another  sop  will  be  the 
repeal  of  the  ten  per  cent.  tax.  Under  this  system,  it  will  make, 
not  the  government  the  regulator  of  the  amount  of  money  to  be 
circulated  in  the  United  States,  but  the  banks,  and  we  shall  have 
a  continual  succession  of  plethoras  and  stringencies  in  the  money 
market,  until  a  second  Andrew  Jackson  shall  rise  in  the  land,  and 
declare  that  the  people  shall  be  masters,  not  slaves,  of  the  money 
gods. 

I  shall  discuss  the  new  policy  of  selling  bonds  to  get  gold  in  full 
detail  at  some  future  time.  The  saddest  feature  in  the  whole  mat- 
ter of  the  demonetization  of  silver  in  the  United  States,  and  in  the 
movement  for  the  restoration  of  it  to  the  full  functions  of  a  money 
metal,  is  the  fact  that  among  the  statesmen  holding  exalted  posi- 
tions of  trust,  responsibility  and  power  in  our  government,  there 
are  a  few,  and  not  few  enough  "incorruptible  "  millionaires  recently 
and  suddenly  millionaired ;  and  that  there  are  others,  many  or 
few,  who  are  candidates  for  the  manipulation. 


India  and  the  United  States. 


THE  RUPEE— SOME  CONSEQUENCES  OF   OUR  DEMON- 
ETIZATION ACT— THE  HAWAIIAN  QUESTION. 


Norfolk,  Va.,  November  3d,  1894. 

To  the  Editor  of  the.  Norfolk  Pilot  : 

I  comply,  iu  the  following  paragraphs,  with  your  request  for  an 
expression  of  my  views  on  the  later  phases  of  the  silver  question. 
I  write  earnestly,  but  sorrowfully.  The  contemplation  of  the  facts 
to  be  narrated  makes  my  task  a  sad  one,  but  I  shall  write  with 
what  spirit  the  exasperating  topic  may  provoke. 

British  India  is  nearly  as  large  as  all  Europe,  excluding  Russia 
and  Turkey,  containing  more  than  200,000,000  of  people,  and  pos- 
sessing latent  and  patent  resources  surpassing  estimation. 

Its  productions  are  almost  exclusively  agricultural,  and  its  chief 
staples  are  wheat  and  cotton.  These  facts  make  this  great  depen- 
dency of  the  English  crown  a  rival  of  the  United  States  in  the 
produce  markets  of  Europe  :  India  is  practically  our  only  rival. 

In  the  competition  between  the  United  States  and  British  India, 
in  the  production  of  wheat  and  cotton,  the  United  States  held  the 
advantage  up  to  1873.  John  Bull  had  tried  to  destroy  this  advan- 
tage bv  inciting  a  crusade  against  African  slavery  in  the  Southern 
States,  and  thereby  gradually  bringing;  on  a  bloody  and  destructive 
conflict  of  sections  in  our  country.  He  had  discovered  a  mote  in 
Brother  Jonathan's  eye  in  the  form  of  slavery,  and  had  brought  a 
world  of  trouble  on  his  American  brother  in  extracting;  that  mote. 
But  his  victim  survived  the  trouble.  The  blood,  carnage  and  des- 
olations of  civil  war  foiled  to  destroy  our  great  industries.  The 
negroes  went  lustily  to  work  on  cotton,  and  produced  as  much  of 
it  after  the  civil  war  as  before.  The  cultivation  of  wheat  grew 
apace  all  through  the  Union,  the  production  increasing  marvel- 
ously  under  the  influence  of  steam  plows,  steam  reapers  and  steam 
threshers  in  the  hands  of  stalwart  veomen. 


44  SOUND  MONEY. 

We  had  another  advantage  over  John  Bull ;  we  produced  a 
prodigious  quantity  of  silver ;  more  than  seventy-five  millions  of 
dollars'  worth  a  year;  and  were  able  to  export  fifty-five  or  sixty 
millions  annually  of  this  production. 

Moreover,  President  Monroe  had  forbidden  John  Bull's  inter- 
ference with  any  of  the  sister  republics  south  of  us  for  any  pur- 
pose, whether  for  that  of  securing  control  of  any  of  their  industries 
of  which  silver  mining  was  chiefest,  or  influencing  their  policy  in 
any  respect. 

Wheat,  cotton  and  silver  ;  these  were  the  articles  that  constituted 
the  bulk  of  our  balance  of  trade  with  Europe ;  these  were  the 
articles  most  closely  connected  with  the  trade  and  finances  of 
British  India.  The  great  staples  of  our  foreign  commerce  (as 
distinguished  from  products  grown  and  consumed  and  not  largely 
shipped,  such  as  Indian  corn),  are  wheat,  cotton  and  silver.  It 
was  their  supremacy  in  the  exportation  of  these  staples  that  gave 
the  United  States  their  marvelous  growth,  prosperity  and  wealth. 
They  were  about  to  transfer  to  Uncle  Sam  the  sceptre  of  the  seas. 

John  Bull  saw  his  fate.  By  constructing  a  vast  system  of  rail- 
roads throughout  India  at  incalculable  expense,  he  had  sought  to 
stimulate  in  the  rich  soils  of  the  countries  watered  by  the  Indus 
and  the  Ganges  a  production  of  wheat  and  cotton,  which  would 
enable  him  to  compete  with  us  for  the  wealth,  power,  prosperity 
and  prestige  incident  to  the  profuse  production  of  those  staples. 
But,  although  he  controlled  a  population  of  240,000,000  subjects, 
while  we  could  count  but  65,000,000  citizens,  his  railroads  and  his 
gigantic  endeavors  by  these  and  other  agencies  to  rival  us  in  the 
production  of  the  two  leading  staples  of  commerce,  failed  of  his 
object,  and  it  became  necessary  for  him  to  resort  to  some  abnormal 
expedient  to  accomplish  it.  The  expedient  selected  was  what  Mr. 
Goschen  calls  "financing." 

As  he  nowhere  possessed  any  valuable  mines  of  silver,  and, 
being  the  sovereign  of  India,  was  a  purchaser  of  that  metal,  John 
Bull  had  nothing  to  lose  and  much  to  gain  by  depreciating  the 
value  of  silver. 

The  great  hunger  of  India  is  for  silver ;  that  metal  is  her  pas- 
sion ;  all  the  silver  that  can  be  taken  there  is  eagerlv  absorbed  in 
the  trinkets  and  hoards  of  her  crowded  millions  of  inhabitants. 

When  John   Bull   undertook  to  procure  the  demonetization  of 


SOUND  310 XEY.  45 

silver  by  the  United  States  in  1873,  the  intrinsic  value  of  the  silver 
dollar  was  three  and  a  half  per  cent,  greater  than  that  of  the  gold 
dollar;  the  metal  in  the  silver  dollar  being  worth  more,  as  a  com- 
modity in  the  market,  than  the  metal  in  the  gold  dollar  by  that 
premium.  For  ninety  years  of  our  bimetalic  policy,  silver  had 
never  gone  below  the  par  of  gold,  and  often  gone  above  it,  before 
1873. 

It  is  an  undenied  historical  fact  that  the  act  of  1873,  purporting 
to  be  a  revisal  of  the  laws  relating  to  the  national  mints,  but 
which  put  a  stop  to  the  coinage  of  the  silver  dollar  and  divested 
that  coin  of  its  legal  tender  function,  was  furtively  passed.  Xeither 
the  Congress  which  passed  it,  nor  the  president  (Grant)  who 
signed  it,  knew  of  these  important  features  of  the  act.  The  ques- 
tion of  demonetizing  silver  and  closing  against  it  the  mints  which 
had  been  engaged  in  its  free  coinage  since  the  beginning  of  the 
federal  government,  had  never  been  presented  to  the  American 
people,  nor  debated,  nor  considered  by  them.  The  act  which 
effected  this  purpose  was  never  authorized  by  them ;  and,  having 
been  furtively  passed  in  a  period  in  which  specie  payments  were 
suspended,  not  a  hundred  people  in  the  land  knew  for.  years  alter 
silver  had  been  demonetized,  that  the  fell  trick  had  been  practiced. 

John  Bull  had  formed  the  acquaintance  of  two  incorruptible 
members  of  Congress,  one  in  each  house  ;  he  never  deals  with  any 
but  incorruptible  men.  When  he  needs  and  confers  with  such 
characters  they  immediately  become  so  rich  that  they  scorn  the 
bagatelle  of  a  bribe. 

The  metals  which  are  called  precious  metals  derive  their  pre- 
ciousness  almost  exclusively  from  their  being  used  as  money;  and 
they  are  coined  into,  and  decreed  to  be,  money,  by  the  govern- 
ments in  which  they  circulate.  Substances  which  have  real  in- 
trinsic value  are  disqualified  for  use  as  money  by  that  fact :  it  is 
only  substances  that  have  little  value  except  as  money  that  are 
coined  by  the  public  mints,  and  are  made  legal  tender  by  the  fiat 
of  law.  John  Bull,  through  several  of  his  ablest  authors  on  pub- 
lic economics,  has  taught  that  those  who  stickle  for  intrinsic  value 
in  the  paper  and  metals  of  which  legal  tender  money  is  made,  are 
dunces — except  those  who  are  rascals. 

The  closing  of  our  mints  to  silver,  and  its  deprival  by  law  of  the 
legal  tender  function,  converted  it  in  this  country  into  a  mere  com- 


46  SOUND  MONEY. 

modity  of  commerce.  It  immediately  began  to  sink  in  value,  and 
ran  down  in  a  short  time  to  a  point  at  which  the  silver  in  a  dollar 
was  worth  only  eighty  cents.  By  that  time  the  American  people 
came  to  a  knowledge  of  the  trick  which  had  been  secretly  prac- 
ticed in  1873,  and  required  Congress  to  enact  a  law,  in  the  Bland 
act,  remonetizing  the  silver  dollar;  that  is  to  say,  restoring;  to  it 
the  legal  tender  function,  and  requiring  the  mints  to  coin  two  and 
a  half  to  four  millions  of  them  per  month,  from  silver  purchased 
by  the  government  for  that  purpose.  The  mints,  however,  still 
remained  closed  to  the  people.  Nobody's  412^  grains  of  silver 
could  be  coined  into  a  legal  tender  dollar,  but  those  bought  in 
open  market  by  the  government,  from  silver  offered  there  as  a 
commodity. 

Our  production  of  silver  was  at  least  $75,000,000  a  year;  our 
government's  purchases  under  the  Bland  act  were  but  little  more 
than  $30,000,000 ;  and  silver,  under  this  wTeak  demand  of  a  single 
purchaser,  went  down  and  fell  and  cheapened  in  the  market. 

By  1890,  so  frightful  was  the  debacle  in  the  market  price  of 
silver,  that  even  the  incorruptible  Sherman,  still  cherishing  faint 
hopes  of  the  Presidency,  became  frightened  at  the  results  of  the 
demonetizing  act  of  1873.  He,  therefore,  induced  the  passage 
of  an  act  by  Congress  authorizing  the  government  to  purchase 
4,500,000  ounces  of  silver  per  month  at  market  prices  in  open  mar- 
ket and  to  coin  the  metal  into  dollars  and  to  store  it  in  the  treas- 
ury, issuing  certificates  against  it  in  the  form  of  treasurj7  notes. 

In  pursuance  of  this  Sherman  act  the  government  thus  took  up 
just  about  as  much  of  our  annual  silver  production  as  would  have 
been  exported  each  year  to  Europe  over  and  above  our  home  con- 
sumption. This  measure  stayed  the  fall  of  the  price  of  silver  in 
the  market,  and  held  it  somewhere  between  sixty  and  seventy 
cents  for  the  dollars'  worth  while  the  act  was  in  force.  But  such 
a  result  did  not  accord  with  the  policy  of  John  Bull.  He  resolved 
that  the  Sherman  act  should  be  repealed  and  silver  left  to  sink 
lower  in  price  on  the  market.  We  know  what  a  hellobelloo  John 
Bull  raised  in  this  country  in  1893;  that  an  extra  session  of  Con- 
gress was  called ;  that  all  the  power  of  the  American  executive 
and  John  Bull's  agents  in  this  country  was  exerted  to  secure  a 
repeal  of  the  Sherman  act;  that  the  House  of  Representatives 
passed  the  repealing  bill  promptly  without  debate  by  a  majority 


SOUND  MONET.  47 

of  some  140  votes ;  and  that  after  hanging  lire  for  some  months 

*  CD  C71 

in  the  Senate  it  finally  passed  that  body.  Then  silver  took  another 
tnmble  in  price. 

Then  John  Bull's  moral  sense  became  ao;ain  offended.  He  saw 
another  mote  in  Brother  Jonathan's  eve.  He  scornfully  asked  his 
American  brother  if  he  thought  that  that  sixty  cent  dollar  of  his 
which  continued  to  pass  all  over  the  world  at  its  legal  tender  value 
of  one  hundred  cents,  was  an  '<  honest  "  dollar.  His  great  writers 
had  taught  that  there  was  no  money  except  what  the  law  of  the 
country  made  so  by  its  fiat,  and  that  none  but  dunces  (except  ras- 
cals) would  contend  for  "  intrinsic  value  "  in  money,  whether 
made  of  paper  or  metal;  yet,  nevertheless,  John  Bull,  employing 
the  language  of  the  rascal,  continued  sneeringlv  to  berate  Brother 

<D  CD  '  O    •- 

Jonathan  for  circulating  his  80  cent,  70  cent,  60  cent,  50  cent 
dollar. 

There  was  a  beam,  however,  in  John  Bull's  own  eye.  He  had 
closed  his  Indian  mints  to  the  coinage  of  the  rupee  from  silver 
brought  to  it  by  the  ryots,  but  was  running  the  mints  up  to  their 
highest  capacity  in  the  coinage  of  legal  tender  rupees  from  silver 
he  was  buying  in  the  United  States  at  the  constantly  falling  prices 
which  he  had  managed  to  bring  them  down  to  there.  The  par  of 
a  rupee  is  about  forty-eight  cents.  About  two  and  two-thirds 
rupees  are  coined  from  an  ounce  of  silver. 

From  time  immemorial  an  ounce  of  silver  has  bought  a  bushel 

CD 

of  wheat,  and  a  silver  rupee  three  pounds  of  cotton  in  India.  The 
ryots  of  the  Indus  and  the  Ganges  are  a  race  of  yesterday,  to-day 
and  forever.  TThat  they  were  a  thousand  vears  a^o,  thev  are  now : 
and  what  they  are  now,  they  are  likely  to  be  throughout  the 
impenetrable  future. 

The  ryots  will  take  the  same  weights  of  silver  for  their  wheat 
and  cotton  which  thev  have  done  from  the  beginning  of  their  race, 

«/  CD  CD  * 

regardless  of  its  "intrinsic  value.'"'  But  whether  they  are  willing 
to  do  so  or  not,  there  is  John  Bull  coining  the  silver  he  has  bought 
in  America  for  half  its  monev  value  or  less  into  legal  tender  ru- 
pees,  held  up  to  their  par  value  by  the  fiat  of  British  Indian  law, 
and  exchanging!;  these  coins  for  Indian  wheat  and  cotton. 

So  it  is,  so  it  is,  so  it  is.  John  Bull  is  now  buying  American 
silver  at  less  than  50  per  cent,  of  its  money  value  and  coining  it 
into  rupees  of  full  money  value.     He  is  buying  Indian  wheat  with 


48  SOUND  MONEY. 

silver  which  cost  him  only  at  the  rate  of  50  cents  for  what  he  pays 
per  bushel,  and  Indian  cotton  with  silver  which  costs  him  only  6 
cents  for  what  he  pays  per  pound.  The  rates  which  he  thus  pays 
fix  the  prices  of  wheat  and  cotton  in  Liverpool.  They  determine 
the  prices  of  American  wheat  and  cotton  in  our  own  markets. 

The  result  is  that  the  quotations  for  cotton  are  less  than  six 
cents,  and  Mr.  Corbin  told  me  last  week  in  Richmond  that  the 
farmers  of  the  Rappahannock  had  sold  their  wheat  of  1894  for  a 
net  of  only  forty-eight  cents  a  bushel.  The  end  is  not  yet.  The 
prices  of  all  material  property  are  graded  by  the  prices  of  wheat, 
cotton  and  silver. 

It  has  been  announced  in  the  English  Parliament  that  the  British 
government  expected  to  bring  down  the  market  value  of  the  silver 
in  the  American  dollar  to  thirty-two  cents,  which  will  put  cotton 
down  to  five  cents  and  wheat  to  less  than  thirty-seven  and  a  half 
cents  a  bushel.  Such  a  result  is  inevitable  unless  a  check  be  ap- 
plied by  ourselves  to  a  policy  which  is  pauperizing  our  agricultu- 
rists, covering  all  our  second  grade  lands  with  brambles  and  briars, 
and  slowly  and  surely  converting  our  great  wheat  and  cotton 
growing  regions  into  a  wilderness  of  lost  industries. 

The  remedy  is  as  simple  as  the  cause  of  the  universal  depression 
in  the  business  of  the  country  is  obvious.  It  consists  in  restoring 
the  financial  laws  and  reinstating  the  financial  policy  under  which 
our  country  grew  up  and  prospered  and  flourished  during  the  first 
ninety  years  of  its  history,  up  to  the  shameful  year  1873. 

Three-fourths  of  the  human  race  are  silver-using  and  not  gold- 
using  populations. 

To  establish  closer  relations  with  the  silver-using  races,  our 
government,  refraining  from  trusting  the  work  to  a  corporation  of 
tory  capitalists,  controlled  by  cockney  bondholders,  might,  on  its 
own  account,  take  hold  of  the  Nicaragua  ship  canal,  and  push  it 
to  prompt  completion,  bringing  the  Atlantic  and  Pacific  Oceans 
and  peoples  together. 

The  Sandwich  Islands  are,  of  course,  ours  by  natural  right, 
those  necessary  stepping-stones  to  Asia,  the  reservoir  of  commer- 
cial wealth.  We  get  nothing  but  hard  bargains  in  our  trade  with 
Europe.  We  obtain  wealth  untold,  which  is  power  immeasurable, 
from  trade  with  Asia.  To  command  that,  is  for  us  to  command 
this  globe.. 


SOUND  310 XEY.  49 

"Why  do  New  England  statesmen  oppose  annexation?  All  of 
our  valuable  annexations  have  been  made  by  southern  statesmen. 
Louisiana  up  to  Canada,  on  the  right  bank  of  the  Mississippi,  by 
Jefferson ;  Texas  by  that  true  Virginian,  John  Tyler ;  California, 
which  spread  our  country  out  to  the  Pacific,  by  Polk,  a  North 
Carolina-Tennessean.  "We  don't  want  to  annex  Asia,  or  any  part 
of  her,  but  it  is  of  immense  importance  that  we  command  her 
commerce.  We  cannot  do  this  except  by  annexing  the  Sandwich 
Islands.  It  was  Democratic  Presidents  who  made  our  country 
great  bv  annexations.  Why  should  the  present  Democratic  Presi- 
dent  hesitate  to  follow  such  noble  precedents  as  Jefferson,  Tyler 
and  Polk  have  set  him 

But  for  the  Hawaiian  people,  who  are  a  dwindling  handful,  we 
need  care  nothing.  General  S.  C  Armstrong,  of  the  Hampton 
Institute,  in  his  letters  from  the  Sandwich  Islands  in  1880,  said  of 
the  Hawaiians  that  thev  had  no  word  for  home,  or  mother,  or 
husband,  or  wife. 

Annexation  would  plant  American  civilization  there  and  make 
those  words  the  foundation  stone  of  that  civilization.  "With  the 
Xicaraguan  canal  and  the  Sandwich  Islands  part  and  parcel  of  the 
American  Republic,  John  Bull  would  again  be  baffled,  and  the 
remorseless  wheels  of  manifest  destiny  would  again  roll  on  silver- 
mounted. 

It  is  a  sorrowful  thought  that  so  many  thousands  of  American 
citizens  are  giving  aid  and  comfort  to  John  Bull  in  the  most 
deadly  war  he  ever  waged  against  the  independence  of  our  country. 

But  the  disloyalty  has  not  extended  to  the  masses  of  the  Amer- 
ican  people.  They  are  fast  becoming  alive  to  the  danger  that  is 
sapping  their  prosperity.  They  are  indignant  at  the  toryism  of 
the  great  money  class.  They  are  in  emeute  against  the  old  parties 
and  politicians  which  have  surrendered  to  the  hypnotizing  power 
of  the  monometallic  octopus.  They  are  resolved  in  the  good  year 
1896  to  drag  down  the  men  who  in  the  arrogance  of  undesert  are 
filling  our  country's  high  places  of  honor  and  trust,  and  to  replace 
them  with  men  who  will  realize  that  they  have  a  country  to  serve 
and  to  save. 


A    BIMETALIST'S    STUDY 


OF   THE 


Causes  of  Our  Present  Monetary  Disorders. 


Abingdon,  Va.,  July  27th,  1893. 

To  the  Editor  of  the  Richmond  Times: 

The  real  causes  of  our  financial  troubles  are  not  domestic. 
They  are  of  Foreign  contrivance  and  direction.  The  President 
has  called  Congress  into  extra  session  because  of  a  novel  order  of 
the  British  Government  respecting  the  Asiatic  rupee.  The  Presi- 
dent's call  is  unprecedented  in  financial  history.  I  refer  to  it,  not 
to  criticise,  much  less  to  censure,  but  as  showing  that  the  financial 
welfare  of  our  country  is  seriously  affected  by  transactions  foreign 
and  not  American.  A  study  of  England's  East  India  policy  by  the 
American  people  is  compelled  by  the  President's  call.  It  brings 
the  finance  discussion  to  a  climax.  It  lifts  it  out  of  the  ruts  of 
provincial  partisanship  and  directs  it  to  the  true  sources  of  inquiry. 
The  proclamation  is  the  most  auspicious  fact  of  the  times.  It 
remains  for  Congress  to  put  forward  its  statesmen  and  not  its 
empirics,  and  show  the  country  whether  it  possesses  any  Hamiltons 
or  Jeft'ersons  in  finance. 

A  very  influential  class  of  bankers  in  our  Eastern  States  ascribe, 
or  affect  to  ascribe,  our  financial  disorders  to  the  Sherman  act.  I 
am  not  a  partisan  of  the  act.  In  the  great  matter  of  world's 
finance  it  has  no  rightful  place  or  relevancy.  It  has  had  no  agency 
in  bringing  about  existing  financial  conditions.  The  hard  times 
are  world  wide.  The  severity  is  greater  in  Australia  than  in 
America.  All  Europe  is  suffering;  the  producing  classes,  manu- 
facturing and  agricultural,  more  than  others.  Agriculture  is 
prostrate  in  England  herself,  and  in  Scotland,  and  Archbishop 
Walsh  has  pictured  with  electric  vividness  the  distress  of  the  Irish 
in  Ireland.     The  Sherman  act  is  not  known  in  Australia  or  Europe, 


SOUND  MONEY.  51 

or  in  the  kingdom  of  Great  Britain  and  Ireland.     Congress  will 
be  wise  to  ignore  as  well  the  bete  noire  itself  as  its  deeriers. 

All  the  world  over  are  trade  and  finance  off  the  normal  basis. 
If  I  were  required  to  answer  in  a  phrase  the  continually  pressed 
question,  what  is  the  matter  with  business  everywhere?  I  would 
say  that  property  values  have  gone  to  wreck  and  ruin,  that  the 
bottom  is  knocked  out  of  prices. 

But  this  answer  is,  of  course,  empirical;  the  question  recurs. 
Why  are  all  values  in  ruin '?  I  hope  to  be  able  in  the  course  of 
this  paper  to  bring  some  elucidation  to  the  inquiry. 

It  is  conceded  by  all  who  have  the  knowledge  of  study  and 
instruction,  that  gold  has  risen  about  50  per  cent,  in  value,  com- 
pared with  the  general  values  of  property  since  1873.  Inasmuch 
as  the  business  of  all  Europe  is  now  conducted  on  the  gold  basis, 
and  inasmuch  as  our  Eastern  bankers,  and  our  Secretaries  of 
Treasury  have  succeeded  in  bringing  the  business  of  our  own  bi- 
metalic  country  practically  to  the  gold  basis,  therefore,  it  results 
that  the  debtor  classes  are  paying  dollar  debts  with  dollar  and  a 
half  money — a  state  of  things  entailing  distress  in  all  liquidations, 
and  ruin  in  most  of  them,  by  its  sweeping  destruction  of  margins. 

The  situation  is  better  realized  when  it  is  described  in  a  manner 
the  reverse  of  that  just  employed.  Gold,  notwithstanding  its 
rise  in  value,  being  still  the  enforced  standard,  and  continuing 
therefore  to  be  rated  at  a  hundred  cents,  the  average  values  of 
property  in  general  must  be  regarded  as  having  fallen,  compared 
with  gold,  to  sixty-six  and  two-third  cents;  wheat,  cotton,  lands, 
lumber,  iron,  silver  and  property  generally,  having  lost  thirty-three 
and  one-third  per  cent,  when  sold  for  money  estimated  as  gold. 

Whether,  therefore,  this  gap  (or  gape)  between  the  values  of 
gold  and  of  property  be  ascribed  to  a  shrinkage  in  propert}?  values, 
or  honestly  to  a  rise  in  gold,  the  pinch  is  the  same. 

The  difficulty  of  the  times  is  that  debtors  and  men  in  active 
business,  whose  means  of  meeting  obligations  depend  on  sales  of 
property,  have  to  pay  full  dollars  with  sixty-six  cents  assets,  a  rate 
that  is  killing.  If  the  Sherman  act  has  any  possible  relation  to 
this  condition  of  things,  I  am  unable  to  discover  it. 

True  that  the  deeriers  of  the  act  contend  that  it  facilitates  the 
exportation  of  gold.  But  the  exportation  of  money  metals  de- 
pends upon  the  balance  of  trade.     This  is  an  axiomatic  truth.     If 


52  SOUND  MONEY. 

we  owe  abroad  more  than  our  exports  will  pay,  we  remit  gold  to 
discharge  the  resulting  debt.  Gold  is  going  abroad  as  the  result  of 
a  series  of  very  heavy  dealings  in  past  years ;  an  example  of  which 
I  will  very  imperfectly  describe.  An  American  dealer  in  wheat, 
who  has  made  many  shipments  of  that  grain  to  Liverpool,  through 
a  series  of  years,  drawing  bills  against  it  on  the  basis  of  the  prices 
ruling  when  the  bills  were  drawn,  finds  at  last  that  in  consequence 
of  continual  and  heavy  declines  in  the  prices  of  wheat,  he  has 
overdrawn  to  the  extent  of  one  or  more  hundred  thousands  of 
dollars.  This  sum  he  has  to  pay  in  order  to  square  accounts,  and 
it  may  be  hoped  to  wind  up  the  losing  business.  The  balances 
being  heavily  against  this  country,  bills  are  at  a  premium,  and  it 
costing  less  to  ship  gold,  the  unfortunate  American  dealer  in  wheat 
sends  the  gold  off  to  wipe  out  his  debt,  blindly  oblivious  of  the 
Sherman  act.  When  he  began  his  dealings  wheat  commanded 
one  dollar  and  sixty  cents  a  bushel ;  when  he  closed  them  it  brought 
only  seventy  cents.  In  fact,  the  most  crushing  incident  of  the 
genera]  fall  of  prices,  that  is  to  say,  of  the  deplorable  rise  of  gold, 
is  the  havoc  it  has  made  with  our  balance  of  trade ;  for  much, 
very  much,  is  the  matter  with  our  foreign  exports. 

The  comments  of  the  Xew  York  Journal  of  Commerce  on  the 
official  tables  it  publishes  of  the  foreign  commerce  of  the  United 
States  for  1892,  were  as  follows,  in  its  issue  of  the  23d  of  January 
last:    • 

"  For  the  year  1892  this  country  imported  only  $876,198,179  in 
foreign  merchandise,  and  sent  out  $938,419,893  of  domestic  pro- 
duce and  manufactures,  showing  an  excess  of  merchandise  exports 
over  merchandise  imports  of  $62,221,714.  .  In  addition  to  this 
there  have  been  sent  out  to  foreign  countries  during  the  last  year 
$112,472,304  in  specie,  against  an  import  of  only  $39,177,189, 
showing  an  excess  of  $73,295,106  in  specie,  making  a  total  nom- 
inal excess  of  $135,516,198  in  exports  over  imports;  and  in  the 
face  of  this  our  bankers  are  still  shipping  millions  of  gold  every 
week.  The  nominal  balance  of  trade  on  the  year's  business  has 
fallen  off  millions  of  specie." 

The  Journal  of  Commerce  was  speaking  of  the  year  1892.  Only 
a  few  days  ago  the  Richmond  Times,  speaking  with  reference  to 
the  first  half  of  1893,  remarked : 

"  The  treasury  department  has  issued  a  statement  of  the  expor- 


SOUND  MOSEY.  53 

tation  of  breadsturfs  from  this  country  for  the  month  of  June, 
1893,  for  the  six  months  ending  with  June,  1893,  and  for  the  twelve 
months  ending  with  June,  1893,  which  contains  some  striking 
facts.  The  values  of  those  for  the  month  of  June,  1893,  were 
§15,912,751,  against  816,448,977  for  June,  1892.  For  the  six 
months  ending  with  June,  1893,  the  values  were  884,356,414,  as 
against  -8135,935,807  for  the  corresponding  six  months  of  the  pre- 
ceding year.  For  the  twelve  months  ending  June,  1893,  the  values 
were  8188,981,992,  as  against  8238,925,000  for  the  year  ending 
June,  1892.  Our  exports  of  breadstuff's  for  the  twelve  months 
just  ended  are,  therefore,  8100,000,000  less  than  they  were  in  the 
preceding  year." 

Gold  having  disastrously  risen,  property  values  being  in  ruin, 
our  foreign  commerce  being  crippled  by  adverse  balances,  and  our 
exports  powerless  to  rectify  them,  the  question  behind  all  these 
phenomena  recurs,  how  did  this  state  of  things  come  about  ? 

I  come  to  the  consideration  of  the  mischievous  rupee,  a  "  sacred  ': 
coin  satanically  misused.  Until  1871-1873  gold  and  silver  passed 
current  all  over  the  world  as  money.  They  had  been  the  money 
of  the  great  nations  of  antiquity  and  of  the  Bible ;  they  are  the 
rnonev  of  nature :  thev  are  the  two  onlv  metals  which  have  ever 
been  found  in  the  experience  of  mankind  to  possess  the  qualities 
of  precious  value ;  nice  divisibility ;  minimum  susceptibility  to 
abrasion  and  wear ;  maximum  difficulty  of  simulation ;  and  fasci- 
nating beauty,  in  the  form  of  coins,  to  the  eye  of  rich  and  poor. 
Until  the  last  twenty-five  years  the  folly  and  greed  of  man  had 
never  conceived  the  purpose,  or  dared  the  feat  of  demonetizing 
either  of  them. 

They  passed  freely  as  money  all  over  the  world,  none  so  haughty 
as  to  deny  them  welcome.  They  passed  in  the  forms  most  con- 
venient for  money ;  that  is  to  sav,  in  the  coins  struck  off  at  the 
various  mints  of  Governments.  Their  relative  value  was  fixed  by 
each  countrv's  laws  of  coinage  and  les;al  tender.  That  relative 
value  was  virtually  the  same  in  all  countries,  beino-  made  the  sub- 
ject  of  mutual  and  universal  consensus.  True,  that,  in  order  to 
prevent  an  abnormal  movement  of  coins,  not  resulting  exclusively 
from  ordinary  trade  operations,  slight  differences  were  allowed  in 
their  ratio.  The  United  States  of  America  being  the  chief  pro- 
ducer of  silver,  the  ratio  in  weight  of  sixteen  of  silver  to  one  of 


54 


SOUND  MONEY. 


gold  was  adopted  here,  while  in  Europe,  where  the  principal  deal- 
ings with  the  East,  which  was  the  great  importer  of  silver,  were 
conducted,  the  ratio  fixed  was  fifteen  and  a  half  to  one,  and  in 
India,  where  silver  was  absorbed,  the  ratio  was  fifteen  to  one. 
Under  these  ratios  silver  was  slightly  cheaper  in  America,  where 
it  was  produced,  than  in  India,  where  it  was  consumed;  otherwise 
our  silver  coins  would  have  had  too  strong  a  tendency  to  flow  to 
India  instead  of  silver  bullion. 

These  ratios  were  of  common  universal  consent.  It  was  impor- 
tant that  all  the  great  nations  of  the  earth  should  assent  to  them; 
and  necessary  that  several  of  the  most  powerful  should  do  so ; 
France  and  the  United  States  being  in  the  quorum.  Under  these 
ratios,  with  gold  and  silver  as  the  universal  money,  the  commerce 
of  the  world  proceeded ;  the  values  of  all  property  becoming  ad- 
justed to  the  conservative,  the  wise,  it  may  also  be  said  the  Divine, 
economy  of  bimetalism.  Both  metals,  except  in  England,  were 
full  legal  tender,  on  the  basis  of  the  conventional  ratios  that  have 
been  described.  Prices  were  remunerative,  and  money,  except  so 
far  as  wars  and  revolutions  prevented,  was  in  conservative  abund- 
ance, the  rich  using  gold  and  the  poor  silver.  The  following  were 
the  prices  of  sundry  substances  in  the  two  years  preceding  and  the 
two  years  following  our  act  of  1873,  denying  free  coinage  and  full 
leo;al  tender  value  to  silver: 


WHEAT. 

CORN. 

OATS. 

COTTON. 

SILVER. 

YEARS. 

Per 

Bushel. 

Per 
Bushel. 

Per 

Bushel. 

Upland 

Middling. 

Per  m: 

Per  Ounce 
In  London. 

1872. 

$1  61 

SO  67 

$0  48 

$0  20 

..60|  Pence. 

1873. 

1  55 

64 

49 

18 

.58* 

1874. 

1  35 

88 

62 

17 

.57* 

1875. 

1  23 

82 

62 

15 

.56| 

1893. 

70 

48 

42 

07-} 

.34  Pence. 

The  policy  of  demonetizing  silver — that  is  to   say,  denying  to 


SOUND  MONEY.  55 

it  free  coinage — began  in  Europe  in  1871,  and  in  the  United  States 
in  1873.  I  ask  the  reader  to  observe  here  that  the  only  substances 
which  the  above  table  shows  to  have  been  immediately  affected  by 
that  policy  were  wheat,  cotton  and  silver.  These  were  the  articles 
most  closely  connected  with  the  trade  and  finances  of  British  India. 
The  great  staples  of  our  foreign  commerce  (as  distinguished  from 
products  grown  and  consumed  and  not  largely  shipped,  such  as 
Indian  corn)  are  wheat,  cotton  and  silver.  It  was  their  suprem- 
acy in  the  exportation  of  these  staples  that  gave  the  United  States 
their  marvellous  growth,  prosperity  and  wealth.  They  were  about 
to  transfer  to  the  United  States  the  sceptre  of  the  seas. 

England  saw  her  fate.  By  constructing  a  vast  system  of  rail- 
roads throughout  India  at  incalculable  expense,  she  had  sought  to 
stimulate  in  the  rich  soils  of  the  countries  watered  by  the  Indus 
and  the  Ganges  a  production  of  wheat  and  cotton  which  would 
enable  her  to  compete  with  us  for  the  wealth,  power,  prosperity 
and  prestige  incident  to  the  profuse  production  of  these  staples. 
But  although  she  controlled  a  population  of  240,000,000  subjects, 
while  we  could  count  but  65,000,000  citizens,  her  railroads  and  her 
gigantic  endeavors  by  these  and  other  agencies  to  rival  us  in  the 
production  of  the  two  leading  staples  of  commerce  failed  of  their 
object,  and  it  became  necessary  to  resort  to  some  abnormal  expe- 
dient to  accomplish  it.  The  expedient  selected  was  what  Mr. 
Goshen  calls  "  financing." 

As  she  nowhere  possessed  any  valuable  mines  of  silver,  and 
being  the  sovereign  of  India,  was  a  purchaser  of  that  metal,  she 
had  nothing  to  lose  and  much-  to  gain  by  depreciating  its  value. 
This  was,  however,  but  an  incident  of  her  policy,  the  portentous 
object  of  which  will  appear  in  what  follows. 

There  is  no  direct  proof  that  the  clandestine  demonetization  of 
silver  by  the  United  States  in  1873  was  procured  by  emissaries 
from  London.  Mr.  Tyler  wrote  from  Sherwood  Forest  in  De- 
cember, 1860  :  "  The  great  weakness  of  all  confederacies,  through 
all  time,  has  consisted  in  their  exposure  to  the  intrigues  of  other 
powers ;  and  most  surely  if  there  ever  was  a  motive  to  influence 
foreign  governments  to  attempt  a  course  of  division  and  overthrow 
it  exists  in  the  case  of  our  own  confederation.  Hoi  din  q-  together 
for  forty  years  longer,  and  all  the  other  governments*  would 
be  but  pigmies  in  comparison."     Bribery  and  intrigue  are  always 


56  SOUND  MONEY. 

unsusceptible  of  proof.  But  a  study  of  the  cunning  by  which  the 
legislation  ot  1873  was  enacted  by  a  Congress,  wholly  ignorant  and 
unconscious  of  what  it  was  doing,  and  wholly  unauthorized  by  the 
people  to  take  such  action,  will  convince  any  rational  mind  that  it 
was  the  result  of  foreign  intrigue.  Silver  had  been  coined  in  the 
mints  and  current  as  legal  tender  money  in  the  United  States  from 
1785  until  1878.  But  in  February  of  that  year,  by  mysterious 
agency,  Congress  was  deceived  into  demonetizing  that  metal  by 
prohibiting  its  free  coinage  in  the  mints  of  the  United  States,  and 
making  it  legal  tender  only  for  sums  not  greater  than  85.  Ger- 
many, which  had  in  1871  exacted  $1,200,000,000  of  gold  from 
France  as  a  war  indemnity,  had  also  been  persuaded  before  the 
mysterious  action  of  the  American  Congress,  to  suspend  the  coin- 
age of  silver  in  the  imperial  mints.  Most  of  the  smaller  powers 
of  Europe  are  dominated  by  England  and  Germany,  and  the  pro- 
curing of  similar  action  by  them  was  a  measure  of  easy  accom- 
plishment. Finally,  several  years  later,  France  was  obliged,  in 
self-defence,  to  close  her  mints  to  all  silver  but  her  own,  though 
continuing  to  accord  to  silver  its  full  les;al  tender  function.  And 
thus  it  came  about  that  the  free  and  unlimited  coinage  of  silver 
was  found,  soon  after  1873,  to  have  ceased  throughout  Europe  and 
in  the  United  States.  Indeed,  silver  had  come  to  be  coined 
nowhere  throughout  the  civilized  world  in  any  quantity,  except  in 
British  India,  for  it  is  useless  to  speak  of  the  Spanish- American 
republics.  In  British  India  alone  did  the  free  coinage  of  silver 
prevail,  the  amount  coined  in  1891  having  been  £17,000,000  sterl- 
ing, or  885,000,000,  chiefly  in  the  form  of  the  rupee,  the  par  value 
of  which  is  48  cents,  which  is  its  legal  tender  value  in  India. 
Xearly  all  the  silver  which  goes  into  India  goes  from  London. 

The  producers  of  wheat  and  cotton  in  India  uninquiringly  accept 
the  legal  tender  rupee  at  its  par  value  for  their  crops  without 
thought  of  the  cost  in  London,  of  the  silver  of  which  it  is  coined. 
They  are  willing  dupes  in  the  matter.  From  time  immemorial 
the  myriad  millions  of  people  in  what  is  now  British  India  have 
been  in  the  habit  of  selling  their  wheat  at  the  rate  of  an  ounce  of 
silver  for  a  bushel  of  grain.  They  are  superstitiously  impervious 
to  foreign  ideas,  averse  to  innovations,  fixed  in  old  habits,  devoted 
to  accustomed  methods,  hostile  to  novelty,  and  stolidly  repellant 
of  change  in  every  form.     They  accept  an  ounce  per  bushel  for 


SOUXD  MONEY.  57 

their  wheat,  and  a  corresponding  price  per  pound  for  their  cotton, 
with  sublimated  indifference  to  the  fluctuations  of  prices  in  the 
markets. 

The  fact  results  that  England  obtains  wheat  and  cotton  in  India 
at  a  cost  graduated  to  the  cost  of  silver  in  London.  By  procuring 
the  demonetization  of  silver  by  the  United  States  and  Europe,  she 
has  been  enabled  so  to  put  down  the  market  price  of  the  metal  in 
London  as  to  leave  a  margin  of  profit  measured  by  that  deprecia- 
tion on  the  wheat  and  cotton  bought  with  legal  tender  rupees 
in  India.  When  silver  in  London  before  1873  was  at  the  par 
59  pence  (equal  to  118  cents)  per  ounce,  that  was  the  price  she 
paid  for  wheat  in  India.  To  bring  it  to  Liverpool  cost  6  pence  (or 
12  cents)  more,  and  so  the  price  of  India  wheat  in  Liverpool  was 
the  price  per  ounce  of  silver  in  London,  plus  12  cents.  That  is  to 
say  that  when  silver  was  at  a  par  of  ]18  cents  before  1873,  Indian 
wheat  could  not  be  laid  down  in  Liverpool  for  less  than  130  cents 
net,  American  wheat  bringing  more  or  less  higher  prices,  by  reason 
of  its  higher  grades  and  quality.  These  were  not  only  remunera- 
tive, but  profitable  prices.     The  case  was  similar  with  cotton. 

But  since  1873  how  has  the  case  been  ?  The  silver  rupee  still 
retains  its  legal  tender  value,  and  par  purchasing  power  in  India  ; 
while  the  silver  from  which  it  is  coined  can  be  purchased  in  the 
London  market  for  33  pence  or  66  cents  per  ounce.  The  result  is 
that  the  price  of  wheat,  this  staple  product  of  our  country,  has 
been  depressed  in  our  own  markets  to  figures  approximating  the 
66  cents  per  ounce  which  London  vouchsafes  to  pay  for  our  silver. 
Such  is  the  situation,  such  the  result  brought  about  by  the 
"  financing  "  of  England. 

But  the  story  is  not  all  told.  A  new  step  has  been  taken.  By 
the  recent  order  of  the  British  Secretarv  of  the  State  for  India, 
the  Indian  mints  are  closed  to  the  silver  of  the  public,  and  none 
of  the  metal  will  hereafter  be  coined,  except  that  presented  by  the 
government  itself.  The  effect  of  this  measure  is  to  close  the  silver 
market  of  London  to  all  purchases  for  India  except  those  made  by 
the  government,  and  to  stop  the  exportation  of  silver  to  India, 
except  on  public  account.  Still  another  part  of  the  story,  how- 
ever, is  yet  to  be  told.  Silver  commands  in  London  about  thirty- 
three  pence :  but  the  Secretary  for  India  accompanies  the  order 
which  has  been  referred  to  by  the  announcement  that  the  govern- 


58  SOUND  MONEY. 

raent  will  determine  for  itself  the  price  it  will  pay  for  silver,  and 
has  now  determined  that  this  price  shall  be  one  shilling  four  pence 
per  ounce — that  is  to  say  :  sixteen  pence,  or  thirty-two  cents.  Mr. 
Gladstone  says  to  the  American  people  :  "  I  will  close  Her  Majesty's 
mints  in  India  absolutely  to  your  silver,  and  for  such  of  your 
metal  as  I  may  require  for  my  own  purposes  I  will  give  you  half 
the  London  price." 

Mr.  Cleveland  has  promptly  responded  to  this  characteristic 
insult,  and  has  called  Congress  into  extra  session.  England's 
financing  has  rained  the  agricultural  industries  of  this  country. 
All  prices  sympathize  with  those  of  wheat,  cotton  and  silver,  our 
great  money  crops.  In  order  to  accomplish  the  ruin  of  the  wheat 
and  cotton  culture  of  America,  it  was  necessary  to  strike  the  silver 
miners.  The  miners  are  in  emeute ;  and  in  spite  of  the  sarcasms 
of  Eastern  newspapers,  I  will  say,  in  manly,  patriotic  emeute. 
The  agriculturists  will  join  them.  Effervescence  is  a  dangerous 
popular  symptom.  .Congress  will  meet  in  extra  session  in  the 
seething  month  af  August. 

The  President's  proclamation  calling  Congress  together  was 
rendered  necessary  by  the  British-Sherman  act  or  order,  which  I 
have  described.  Until  that  order  the  Indian  mints  were  free  to 
the  public,  just  as  the  mints  of  the  United  States  were  until  1873. 
The  order  closes  the  Indian  mints  to  the  silver  of  the  public,  just 
as  our  Sherman  act  closes  the  American  mints  to  the  silver  of  our 
citizens.  The  order  keeps  open  the  Indian  mints  to  the  silver  of 
the  government,  just  as  our  Sherman  act  does  that  thing.  The 
order  announces  the  purpose  of  the  government  to  purchase  sil- 
ver on  its  own  account  at  its  own  price.  Our  Sherman  act  makes 
the  like  provision,  except  that  it  does  not  fix  the  price  of  the  silver 
purchased,  but  leaves  that  to  be  fixed  for  us  in  London.  Wall 
Street  is  a  colony  and  dependency  of  London,  and  it  is  amazing 
to  witness  how  rabidly  denunciatory  it  is  of  the  American-Sher- 
man act,  and  how  very  quiescent  it  is  with  the  British-Sherman  act. 

Well  may  the  President  of  the  United  States  be  alarmed  by  a 
Sherman  act  in  LoncTon,  which  threatens  to  put  silver  down  to  six- 
teen pence  per  ounce,  American  wheat  down  to  sixty  odd  cents  a 
bushel,  and  American  cotton  to  less  than  seven  cents  per  pound. 
The  British  act  is  a  crushing  thing;  the  American-Sherman  act  is 
a  mere  bagatelle. 


SOUXJD  MONEY.  59 

Distrust,  want  of  confidence,  are  universal  in  the  United  States. 
The  situation  is  alarming.  The  danger  is  that  silver  will  gra&ti- 
ally  go  down  in  value,  until  it  reaches  the  price  at  which  Mr.  Glad- 
stone's secretary  fixes  it — sixteen  pence  (thirty -three  cents)  an 
ounce — bringing  wheat  and  cotton  and  every  staple  connected  with 
India  down  with  it.  Congress  will  be  called  upon  to  provide  a 
remedy  for  the  great  financial  distress  prevailing,  and  the  greater 
distress  threatened.  It  will  fail  to  provide  the  remedy.  "Wall 
Street  will  prevent;  England  will  prevent.  Mr.  Tyler's  letter 
supplies  the  reason. 

The  Sherman  act  directs  the  purchase  of  four  and  a  half  mil- 
lions of  ounces  of  silver  per  month,  or  fifty-four  millions  of  ounces 
per  annum,  by  the  Secretary  of  the  Treasury  on  government  ac- 
count. This  is  about  the  quantity  of  the  metal  that  would  be 
annually  exported,  over  and  above  the  home  consumption.  It 
directs  the  silver  to  be  paid  for  with  Treasury  notes,  and  makes 
the  notes  legal  tender,  receivable  in  payment  of  public  dues,  and 
redeemable  in  gold  or  silver  coins  at  the  Treasurv.  As  the  banks 
of  Wall  Street  and  of  the  Atlantic  States  vigorously  boycott  silver 
coin,  all  recent  Secretaries  of  the  Treasury  have  been  redeeming 
Treasury  notes  in  s^old.  This  is  almost  the  onlv  2,'old  now  avail- 
able  for  exportation,  and  it  is  the  pusilanimity  of  secretaries,  and 
not  the  Sherman  act,  that  produces  the  exportations  of  gold  which 
so  alarm  the  bankers.  The  remedy  for  the  special  evil  is  obviously 
not  the  repeal  of  the  act,  but  a  command  by  Congress  to  the  Sec- 
retary to  exercise  his  right  of  redeeming  Treasury  notes  by  doing 
so  with  silver. 

Until  the  British  Sherman  act  was  announced,  our  bimetalists 
preferred  the  free  coinage  of  silver  to  our  own  Sherman  act.  But 
now  they  object  to  the  repeal  of  our  act,  because  that  would  with- 
draw from  the  market  the  only  considerable  purchaser  of  silver, 
and  tend  to  reduce  that  metal  to  the  level  of  a  mere  commodity, 
having  only  the  value  derived  from  its  use  in  the  arts — leaving 
gold  as  the  only  metalic  money  of  Europe  and  the  United  States. 
The  repeal  would  thus  inaugurate  an  era  of  shin-plasters,  that  is  to 
say,  of  paper  money  not  based  on  coin,  for  gold  would  hide,  and 
there  would  be  nothing  to  stave  off  the  shin-plasters  but  a  few 
hundred  millions  of  le^al  tender  silver  coins  now  in  the  Treasury 
of  the  United  States  and  in  circulation,  which  we  daily  hear  com- 


60  SOUND  MONEY. 

plained  of  as  dishonest  money,  a  burden  and  a  curse.     Already 
the  banks  of  Wall  Street  are  issuing  shin-plasters  in  the  form  of 
clearinghouse    certificates.       Their    example    will    be    contagious. 
The  10  per  cent,  tax  will  be  no  bar  to  shin-plasters. 

The  true  and  only  remedy  for  the  disorders  of  the  times  cannot 
be  hastily  obtained. 

Time,  patience,  long,  hard  and  earnest  work  will  be  necessary 
to  secure  it.  The  remedy  for  the  financial  evils  of  the  day  is  the 
same  for  all  countries  afflicted  by  them,  and  not  merely  our  own. 
It  consists  in  simple  retrogression,  in  a  return  to  the  conditions  of 
1873.  The  sine  qua  nou  of  healthy  finance  is  the  restoration  of  sil- 
ver to  its  wonted  place  in  the  financial  economy  of  the  world. 
Some  degree  of  co-operation  among  nations  is  advisable.  The 
Silver  Conference  Convention  of  1892,  which  was  called  by  Mr. 
Harrison  as  an  affectation,  should  be  revived  by  Congress  as  a 
reality.  Let  France,  the  United  States,  and  the  States  of  the 
Latin  Union  re-establish  the  bimetalic  ratios  of  1873,  and  the  work 
is  done.  England  cannot  demonetize  silver  in  India.  That  metal 
is  the  money  of  three-fourths  of  the  population  of  the  earth.  In 
Asia  it  is  money,  whether  coined  or  uncoined.  To  be  money  in 
Europe  and  America  it  is  necessary  that  its  coinage  ratios  of  weight 
with  gold  be  regulated  b}7  law.  The  ratios  of  1873  are  the  best 
and  most  convenient  and  conservative  that  can  be  adopted. 

The  Secretary  of  State  for  India  has  undertaken  to  establish  a 
ratio  for  the  world  in  his  order,  which  has  been  mentioned.  He 
will  purchase  silver  at  16  pence  or  33  cents  per  ounce ;  his  ratio, 
therefore,  being  twenty-five  or  thirty  to  one.  His  declaration  is 
insulting  enough,  but  it  will  fail  to  materialize.  The  best  money 
ever  known  to  man  is  metalic  money.  The  two  metals  have  little 
intrinsic  value  aside  from  that  derived  from  their  use  as  money. 
Their  most  considerable  value  comes  from  the  stamp  of  the  mint 
and  the  laws  of  the  sovereign  power  making  them  legal  tender. 
The}r  are  not  money  by  virtue  of  being  standards  of  value,  but 
they  measure  values  because  they  are  money. 

Congress,  in  our  country,  has  absolute  power  to  declare  what  is 
money.  If  it  had  no  conscience  it  could  make  gold  bonds  solva- 
ble in  salmon  bricks. 

There  is  no  reason  why  the  silver  dollar  should  be  as  big  as  a 
cart  wheel.     It  is  a  hallucination  to  suppose  that  the  ratio  of  16  or 


SOUND  MONEY.  61 

15J  to  1,  established  before  1873  with  reference  exclusively  to  con- 
venience of  use,  should  not  be  reinstated.  The  gold  dollar  of  that 
period  was  a  little  too  small  and  the  silver  dollar  a  little  too  large 
for  convenience :  but  the  ratio  was  established,  notwithstanding, 
as  the  best  that  was  practicable.  The  fiat  made  the  ratio  right ; 
the  fiat  made  the  gold  and  silver  coins  money.  What  is  needed 
is  money,  and  not  standards,  nor  any  degree  of  intrinsicality.  All 
talk  of  standard  and  intrinsic  value  is  idle  and  delusive.  Money 
is  the  thing  needed,  and  nothing  but  the  fiat  of  Congress  can 
create  legal  tender  money  in  the  United  States.  To  contend  that 
a  silver  dollar  shall  be  enlarged  commensurately  with  England's 
depreciation  of  silver  metal  in  London  is  as  silly  as  to  contend 
that  a  legal  tender  treasury  note  shall  be  amplified  until  the 
intrinsic  value  of  the  paper  of  which  it  is  made  shall  be  equal  to 
the  value  of  the  note.  Xo,  the  ratio  cannot  be  changed  without 
making  the  gold  dollar  too  small  or  the  silver  one  too  large,  and 
both  principle  and  convenience  would  be  sacrificed  by  the  change. 

The  United  States  must  take  the  lead  in  the  work  of  restoration. 
Our  country  will  have  allies  enough  if  she  will  only  take  the  lead 
and  hold  it  worthily.  England  will  be  hostile  either  openly  or 
clandestinely.  The  Gladstone  Government  is  without  honor,  prin- 
ciple or  faith.  In  this  matter  of  the  Indian  rupee  and  the  Ameri- 
can dollar  it  will  make  Perfidious  Albion  more  perfidious  still  in 
the  ratio  of  30  to  1. 

I  thank  the  Times  most  sincerely  for  publishing  this  paper.  I 
thank  it  the  more  because,  unless  I  should  be  fortunate  enough  to 
modify  its  opinions,  what  I  have  said  is  in  violent  antagonism  to 
all  its  teachings.  But  its  readers  form  an  important  part  of  the 
people,  and  in  this  country  all  statesmanship  resides  in  the  people. 
It  is  rarely  found  in  politicians,  whether  in  or  out  of  public  posi- 
tion. These  are  in  general  but  the  partisans  of  preconceived  ideas 
adopted  at  second  hand,  and  their  whole  effort  is  to  force  these 
ideas  upon  the  public,  right  or  wrong ;  so  that,  if  their  preconcep- 
tions be  erroneous,  their  whole  influence  and  work  are  pernicious. 
So  with  editors,  in  degree.  Let  the  people  hear  both  sides. 
Therein  lies  the  safety  of  the  republic.  If  you  and  I  differ  on  the 
questions  discussed  in  this  paper,  let  your  readers  judge  between 
us. 


Congress  Warned  Against  Tampering  with  the  Ratios, 


ON  WHICH  THE  TWO  THOUSAND  MILLIONS  OF  SILVER 

NOW  IN  CIRCULATION  HAVE  BEEN  COINED— 

SERIOUS  QUESTION. 


Abixgdox,  Va.,  August  12th,  1893. 

To  the  Editor  of  the  Dispatch: 

The  President  has  stated  in  the  best  form  possible  the  argument 
in  favor  of  the  unconditional  repeal  of  the  Sherman  act — a  measure 
which  would  be  the  final  step  in  the  demonetization  of  silver. 
The  two  objections  to  the  net  which  the  President  urges  are — 
first,  that  its  continuance  must  cause  a  destruction  of  the  parity 
that  is  now  established  between  gold  and  silver ;  and,  secondly, 
that  it  must  prolong  the  exhaustive  exportations  of  gold  that  have 
been  going  on  from  this  country  for  some  time  past. 

As  to  the  first  objection,  does  it  not  occur  to  every  mind  that 
the  unconditional  repeal  of  the  Sherman  act  must  inevitably  so 
depress  the  price  of  silver  bullion  in  the  market  as  to  destroy  the 
legally-established  and  long-existing  parity  which  it  is  so  important 
to  maintain  ? 

This  is  a  very  serious  consideration,  and  Congress  is  bound,  in 
repealing  the  act,  to  provide  some  countercheck  to  the  fall  of  silver 
bullion  that  would  inevitably  result.  Moreover,  it  is  a  question 
not  only  for  the  United  States,  but  for  all  nations.  Our  govern- 
ment is  now  the  only  purchaser  of  silver  in  the  world.  The  clos- 
ing of  the  Indian  mints  to  the  metal  puts  an  end  to  purchases  for 
remittance  to  India.  The  closing  of  the  Indian  mints  caused  a 
fall  of  15  or  20  per  cent,  in  the  price  of  this  metal.  The  uncon- 
ditional repeal  of  the  Sherman  act,  by  withdrawing  from  the 
market  the  only  remaining  purchaser  of  the  metal,  will  produce  a 
like  fall  of  price.  Will  it  be  possible  to  maintain  the  parity  of  16 
to  1  in  this  country,  and  of  15J  to  1  in  Europe,  of  the  two  thou- 
sand millions  of  coined  silver  now  in  circulation  after  the  fall  in 
price  of  silver  bullion  that  must  ensue  ? 


SOCXJD  MONEY. 


ON    THESE    RATIOS. 


Let  it  not  be  forgotten  that  all  the  silver  in  circulation  in  the 
United  States  and  Europe  has  been  coined  on  these  ratios.  It  is 
no  light  matter,  therefore,  to  take  any  action  that  threatens  these 
ratios,  for  the  amount  of  legal  tender  silver  money  now  in  circula- 
tion on  both  continents  is  immense,  as  will  be  seen  in  subsequent 
paragraphs  ;  and  I  regret  the  action  of  the  recent  caucus  of  silver 
men  in  Congress  on  the  subject  of  the  ratios.  Those  on  which 
two  thousand  millions  of  coined  silver  circulation  are  already 
based  ought  not  to  be  disturbed. 

It  is  a  fancy  of  the  advocates  of  single-standard  money  that 
nearly  all  Europe  is  on  the  gold  basis,  and  that  it  has  been  so  con- 
trived that  the  United  States  is  practically  so,  but  let  us  look  at 
the  statistics  of  the  subject  and  learn  from  them  how  grave  a  mat- 
ter it  is  to  tamper  with  the  value  of  silver. 

GRAXD    AGGREGATE. 

The  amount  of  legal  tender  money  in  the  United  States  (offici- 
ally reported  for  January  1,  1893,)  is  $1,611,321,763.  Each  dollar 
of  this  large  sum  is  as  good  as  any  other  dollar,  the  grand  aggre- 
gate  being  composed  of  $649,788,020  of  gold,  §593,365,365  of 
silver,  and  the  rest  (not  including  gold  and  silver  certificates) 
§368,168,378  of  legal  tender  paper  circulation.  This  sixteen  hun- 
dred and  eleven  millions  of  money  is  but  little  more  than  one- 
third  gold,  and  yet  no  difficulty  has  been  experienced  in  maintain- 
ing at  a  par  with  gold  the  remaining  nine  hundred  and  sixty-one 
millions  of  silver  and  paper  money  in  circulation. 

The  fiat  of  the  government,  its  stamp  on  the  silver  coins,  con- 
joined with  its  legal  tender  laws,  maintains  this  parity.  Let  it  be 
freely  admitted  that  in  respect  to  metallic  money,  this  fiat  should 
not  be  employed  too  far  in  elevating  a  cheaper  metal  when  coined 
into  parity  with  a  dearer.  Xay,  let  it  be  conceded,  that  even  a 
very  powerful  government  cannot  generally  maintain  a  parity  by 
its  mere  fiat,  between  too  money  metals,  when  the  bullion  value  in 
the  market  of  one  of  the  metals  falls  very  far  below  its  par  value. 
But  whether  rightly  or  wrongly  employed  it  is  the  fiat  of  govern- 
ment that  holds  different  kinds  of  currency  in  parity  with  each 
other  on  the  basis  of  legal  tender  laws. 


64  SOUND  MONEY. 

CIRCULATION. 

As  before  stated  the  circulation  of  this  country  stands  thus  : 

Gold  coin, -         -         $649,788,020 

Silver  coins  and  uncovered  paper  coin,     ...       961,533,743 

Of  this  latter  sum  $593,365,365  is  in  the  form  of  legal  tender 
silver  coins ;  the  whole  §961,533,743  of  silver  and  paper  being 
made  par  in  value  by  the  fiat  of  the  government.  It  is  safe  to 
assume  that  the  tiat  will  be  strong  enough  to  hold  the  silver  at 
par  when  the  market  value  of  the  metal  is  less  than  50  per  cent. 
of  par,  and  that  of  the  paper,  of  which  currency  is  made,  is  noth- 
ing ?  Is  not  the  Sherman  act  the  only  present  safeguard  against 
an  incalculable  depreciation  in  nearly  one  thousand  millions  of  the 
money  now  current  in  the  United  States  ?  Would  it  not  be  an  act 
of  fatuity  to  repeal  without  providing  a  substitute  in  some  form  ? 

It  is  an  old  adage  that  "  misery  loves  company."  Under  the 
unconditional  repeal  of  the  act  we  Americans  would  have  the  poor 
consolation  of  knowing  there  would  be  many  sharers  in  our  misery. 
In  all  the  countries  of  Europe  which  are  now  on  the  gold  basis 
their  circulation  of  gold  coins  is  reinforced  by  a  liberal  addition  of 
silver  and  paper  money,  held  at  par  with  gold  by  the  fiat  of  the 
governments.  Just  as  in  the  United  States,  this  augmentation  of 
the  quantity  of  money  in  circulation  beyond  the  amount  of  gold 
possessed  is  an  absolute  necessity  to  the  commerce  of  those  coun- 
tries. 

MAKE-UP    OF    THE    MONEY    SUPPLY. 

.  In  his  valuable  paper  on  the  "  Monetary  Question  of  1892," 
recently  published,  Mr.  Ottomar  Haupt  gives  very  important  statis. 
tics  in  regard  to  the  make-up  of  the  money  supply  in  the  world. 
I  need  not  say  that  Mr.  Haupt  is  one  of  the  highest  living  authori- 
ties on  monetaiy  statistics.  He  has  made  calculations  for  the  end 
of  1885  and  for  the  end  of  1891  of  the  money  circulation  of  the 
following  countries,  viz  :  Austria,  Belgium,  the  British  Islands, 
France,  Germany,  Holland,  Italy,  Portugal,  Eussia,  Scandinavia, 
Spain,  Turkey,  other  European  countries,  the  United  States  and 
Australia. 


SOUND  MONEY.  65 

LEGAL    TENDER    MONEY    IN    GOLD-STANDARD    COUNTRIES. 

Deducting  from  the  total  amount  given  by  him  the  amounts  ap- 
portioned to  Austria  and  Russia,  as  neither  of  these  had  the  gold 
standard,  and  leaving  out  entirely  his  figures  for  the  end  of  1885, 
we  have  the  following  table  of  amounts  stated  in  pounds  sterling 
in  circulation  at  the  end  of  1891  of 

Gold,  -.----£  644,000,000 

Silver  coined,         -             -             -             -             -  320,000,000 

Silver  fractional  coins,             -             -             -  91,000,000 

Uncovered  paper  money,              -             -             -  240,000,000 


Total  gold,  silver  and  paper,       -  -  £1,295,000,000 

LEGAL    TENDER    MONEY    IN    GOLD-STANDARD    COUNTRIES. 

Stated  in  dollars  instead  of  pounds  sterling  the  make-up  of  the 
money  circulation  in  the  United  States  and  the  gold-standard 
countries  that  have  been  named  is  as  follows : 

Gold,    ------  $3,220,000,000 

Silver,  full  coins,    -----  1,600,000,000 

Silver,  fractional  coins,             -  455,000,000 

Uncovered  paper,               -            -             -             -  1,200,000,000 


Total  gold,  silver  and  paper,    -  -  $6,475,000,000 

The  above  is  undoubtedly  a  close  approximation  to  the  amount 
of  money  in  the  currencies  of  the  countries  that  were  on  the  gold 
standard  in  1891.  When  the  figures  are  examined  it  will  be  seen 
that  at  the  end  of  1891  the  actual  gold  entering  into  the  money  of 
the  gold  standard  countries  was  less  than  one-half  of  the  whole  of 
the  money  of  those  countries.  To  that  extent,  indeed,  the  term 
gold  standard  is  a  misnomer,  because  it  is  really  a  standard  of  gold, 
silver  and  paper  money  combined.  It  might  perhaps  be  thought 
that  the  $3,220,000,000  of  gold  determined  the  value  of  the 
$3,255,000,000  of  silver  and  paper,  and  that  these  took  the  value 
of  gold  from  association  with  it  as  legal  tender.  One  would  natu- 
rally suppose  that  the  larger  body  of  money  would  be  more  apt  to 
control  the  value  of  the  smaller  than  vice  versa. 


66  SOUND  MONEY. 

FIXES    THE    PARITY. 

But  the  question  is  immaterial,  for  it  is  the  hat  of  the  govern- 
ment that  fixes  the  parity  in  all  those  countries,  aiid  unless  some 
predominant,  overbearing  cause  supervenes  to  disrupt  this  liga- 
ment the  parity  will  continue  as  long  as  the  flat  remains. 

The  question  is,  therefore,  not  only  for  the  United  States,  but 
for  all  the  countries  on  what  is  erroneously  supposed  to  be  a  gold 
basis.  What  effect  on  the  great  amount  of  money  other  than 
gold  aud  chiefly  silver  entering  into  their  circulation  will  the  with- 
drawal from  market  of  the  largest  purchaser  of  silver  have  upon 
the  mouey  circulation  of  those  countries  ?  If  the  result  should  be 
so  to  depress  the  bullion  price  of  silver  as  to  destroy  the  legal 
tender  value  of  $2,055,000,000  of  silver  coins  now  circulating  on  a 
parity  with  gold  would  not  the  amount  of  money  in  circulation  be 
diminished  to  the  extent  of  that  depression  ? 

TOTAL    VALUE. 

The  prices  of  all  the  property  and  commodities  of  the  countries 
named  are  adjusted  to  a  total  money  circulation  of  $6,475,000,000  ; 
of  which  more  than  two  thousand  millions  of  dollars  consists  of 
silver.  If  this  coined  silver  shall  so  sympathize  with  silver  bullion 
in  value  as  to  lose  the  character  of  current  money  given  it  by  the 
fiat,  it  is  an  axiom  of  political  economy  that  the  money  left  is 
money  not  so  affected  in  value.  Proportionally ;  property  of  all 
kinds  will  still  further  depreciate  in  price  ;  God  knows  how  much. 
It  is  painful  to  contemplate  the  consequences  of  a  still  further  fall 
in  the  values  of  all  property,  and  still  further  rise  in  the  value  of 
money. 

The  Congress  of  this  country  has  never  had  a  more  serious 
question  before  it  than  is  presented  by  the  President's  message. 
However  pernicious  may  be  the  evils  resulting  from  the  continuance 
of  the  Sherman  act,  and  however  desirable  it  may  be  to  be  relieved 
of  those  evils,  yet  I  cannot  help  thinking  that  the  repeal  of  that 
act  without  providing  simultaneously  against  the  depreciation  of 
silver,  which  repeal  would  cause,  would  be  a  fell  blow  inflicted  by 
Congress  on  all  property  values,  and  on  all  industries  in  the  United 
States  and  Europe. 


The  Sherman  Act  of  1890. 


THE  CURRENCY  FAMINE  IN  1893, 


HOW  NOT  TO  RELIEVE  IT—REPEAL  MUST  INTENSIFY 

AND  CAN'T  RELIEVE  IT. 


Abingdon,  Va.,  August  31st,  1893. 

To  the  Editor  of  the  Dispatch: 

In  1873-1874  the  American  owners  of  silver  bullion  were 
denied  the  right  of  carrying  it  to  the  American  mints,  of  having 
it  coined  into  the  constitutional  money  of  the  United  States,  and 
of  putting  it  into  circulation.  This  made  it  necessary  to  ship  and 
sell  their  silver  abroad,  and  it  was  all  sent  to  France  and  India, 
where  only  it  enjoyed  the  privilege  of  the  mints.  A  similar  policy 
in  Europe  so  crowded  the  French  mints  that  France,  about  1877 
or  1878,  had  to  close  them  to  all  silver  except  what  was  owned  by 
her  own  people.  Thus  American  silver  bullion  could  find  no  place 
of  coinage  except  in  the  royal  mints  of  India  (lately  closed). 

American  silver,  sent  through  London  to  India,  was  subjected 
in  London  to  so  great  a  shave  that  the  American  producers  of  the 
metal  insisted  upon  some  measure  of  protection  from  Congress, 
who  had  denied  them  the  right  of  free  coinage.  Congress  accord- 
ingly, in  1890,  enacted  as  a  make-shift  for  free  coinage  (I  think  the 
Democratic  platform  calls  it  a  base  make-shift)  the  Sherman  act. 

THE    SHERMAN    ACT. 

This  act  provided  for  the   American  owners  of  silver  bullion  a 


68  SOUND  MONEY. 

partial  home  market  for  their  metal.  It  directed  the  purchase  by 
the  Treasury,  at  the  market  price,  of  four  and  a  half  millions  of 
ounces  of  silver  a  month,  fifty-four  millions  a  year.  It  directed 
that  payment  for  it  should  be  made  in  Treasury  notes,  redeemable 
in  gold  or  silver.  The  act  was  distasteful  to  the  advocates  of  silver 
money,  because  it  still  denied  the  right  of  free  coinage  at  the 
mints,  and  only  substituted  the  privilege  of  selling  a  limited 
quantity  of  this  money  metal  for  what  it  was  Avorth  merely  as  a 
raw  article  of  commerce.  But  the  act,  while  perpetrating  this 
wrong,  was  of  public  service  in  requiring  the  monthly  issue  of 
something  less  than  four  and  a  half  millions  of  dollars  of  money 
currency. 

The  gold  powers  concentrated  in  Wall  street  have  never  liked 
this  Sherman  law,  miserable  dodge  and  make-shift  as  it  was.  They 
did  not  like  its  furnishing  even  so  limited  a  home  market  as  it  did 
for  the  silver  which  it  was  their  policy  to  proscribe.  They  did  not 
like  its  increasing  the  volume  of  American  currency  by  as- much 
as  four  millions  of  dollars  a  month.  They  objected  to  the  elasticity 
in  the  currency  of  the  United  States  which  this  monthly  issue  of 
new  currency  gave,  and  which  had  so  strong  an  influence  in  pre- 
venting corners  in  the  money  and  produce  markets. 

REPEAL    FORESEEN. 

There  has  been  a  continual  agitation  against  this  Sherman  law 
ever  since  its  enactment.  During  the  last  six  months  it  has  been 
clearly  demonstrated  that  the  act  would  be  repealed.  All  the 
eastern  newspapers  and  most  of  the  western ;  all  the  Chambers  of 
Commerce  in  the  North,  East,  South  and  West  have  been  induced 
to  pronounce  against  the  act ;  and  finally  Congress  has  been  called 
into  extra  session  for  the  especial  purpose  of  removing  the  fore- 
doomed law  from  the  statute-book. 

The  natural  effect  of  this  concerted  and  universal  agitation  and 
of  the  certainity  of  its  repeal  has  been  an  alarm  about  currency  and 
a  fever  for  hoarding  it.  Currency,  in  view  of  the  prospective  stop- 
page of  the  monthly  replenishment  of  $4,000,000,  has  been  hiding 
itself  away  for  several  months,  and  thereby  causing  the  suspension 
of  many  solvent  banks  all  over  the  country.     The  misfortune  is 


SOUND  MONEY.  69. 

that  bankruptcy  has  thus  been  forced,  not  only  upon  banks  unde- 
serving of  confidence,  but  also  upon  banks  in  much  larger  num- 
bers that  were  solvent,  and  were  of  great  value  and  indispensable 
use  to  the  country.  The  currency  famine  resulting  from  the  appre- 
hended cessation  in  the  issuing  of  §4,000,000  of  new  treasury  notes 
per  month  is  the  WHO  that  has  killed  cock-robin. 

FOUR    MILLIONS    A    MONTH. 

We  are  expecting  much  general  benefit,  considerable  ease  in 
business,  marvellous  restoration  of  confidence  from  the  repeal  of 
a  measure  that  gives  us  four  millions  of  currency  per  month 
in  a  currency  famine.  My  own  opinion  is  that  the  cutting  off 
of  this  supply  will  increase  the  currency  famine  now  prevailing. 

How  shall  the  fifty  or  sixty  millions  of  silver  bullion  which  we 
have  each  year  to  spare  be  utilized  for  the  currency  needs  of  the 
American  people  ?  A  naked  repeal  of  the  Sherman  aut  cuts  us  off 
from  fifty  millions  of  currency,  which  is  absolutely  necessary  to 
the  business  needs  of  the  country.  If  this  currency  is  to  be  denied 
us-,  manifestly  the  surplus  silver  it  represents  should  be  utilized  by 
a  bill  for  free  coinage. 


OUR  LEGAL  TENDER  MONEY, 


ANSWER  TO  THE  QUESTION:  IS  THE  SILVER  DOLLAR 
OF  THE  UNITED  STATES  LEGAL  TENDER? 


Norfolk,  Ya.,  December  12th,  1893. 
Dear : 

Up  to  1873,  from  the  beginning  of  the  American  government, 
and  since  1878,  the  coined  dollars  of  silver  by  the  mints  of  the 
United  States  have  been  legal  tender  for  all  amounts.  The  great 
fraud  of  1873  reduced  them  to  legal  tender  for  sums  of  $5.00  and 
less  only ;  but  the  act  of  1878  reinstated  the  silver  dollar  in  its 
constitutional  functions. 

The  coined  silver  dollar  of  the  United  States  is  not  only  legal 
tender  all  over  the  United  States,  but  it  passes  current  at  par 
(sometimes  at  a  slight  discount)  all  over  Europe.  We  have  four 
legal  tenders  in  the  United  States,  viz :  Our  gold  coins,  our  silver 
dollars,  our  greenback  notes,  and,  for  subsidiary  purposes,  our 
nickels  and  small  silver  coins.  There  is  no  single  unit  of  value; 
there  can't  be,  because  value  is  not  mathematical,  like  length, 
weight,  &c,  but  relative,  and  is  ever  changing,  not  only  in  the  at- 
tempted unit  itself,  but  in  all  property.  The  gold  and  bond  bank- 
ers are  trying  to  make  gold  the  only  legal  tender,  but  won't 
succeed.  They  have  forced  the  gold  standard  partially  upon  this 
country,  with  the  aid  of  Carlisle  and  Cleveland.  Their  object  is 
to  make  it  practicable  to  corner  gold,  sometimes  partially,  sometimes 
completely.  Their  success  in  this  endeavor  would  pauperize  man- 
kind. The  pauperizing  process  has  already  commenced.  We 
shall  see  very  hard  times. 

The  policy  of  gold  and  bond  bankers  in  Lombard  and  Wall 
Streets  is  gradually,  step  by  step,  to  make  gold  the  only  legal 
tender,  as  well  in  the  LTnited  States  as  in  Europe.  But  the  use 
of  silver,  even  in  the  gold  basis  countries  of  Europe,  is  a  necessity. 
In  those  countries,  considered  as  a  whole,  there  is  as  much  legal 
tender  silver  in  circulation  as  gold,  and  as  much  legal  tender  paper 
as  either  gold  or  silver.     Nature  and  her  great  laws  are  stronger 


SOUND  MONEY.  71 

than  men,  stronger  than  the  guilds  of  gold  and  bond  bankers, 
reinforced  by  Carlisle  and  Cleveland,  the  betrayers  of  the  silver 
cause  in  this  country. 

The  gold  and  bond  guilds  do  not  expect  to  destroy  the  use  of 
silver  as  money.  Their  object  is  to  discredit  it  as  much  as  pos- 
sible, and  exclude  it  from  use  by  bankers  and  dealers  in  bonds. 
Their  object  is  to  have  gold  always  so  in  hand  as  to  be  cornkrabte, 
partially  or  completely,  at  their  pleasure.  They  desire  to  be  able 
to  apply  the  pauperizing  process,  whenever  convenient  and  when- 
ever prudent. 

Thank  God,  however,  the  silver  dollar  of  America  is  still  legal 
tender.  If  it  were  not,  the  member  of  the  House  of  Delegates 
who  made  the  bet  with  you  would  be  gathering  acorns  for  hogs 
somewhere  in  our  pauperized  country,  relapsed  into  barbarism. 

We  continually  hear  of  the  "  fifty-cent  dollar."  There  is  no 
such  thing  in  existence.  The  American  silver  dollar  will  buy  the 
microbe  gold  dollar  anywhere  in  the  United  States.  It  will  buy  it 
because  it  is  a  dollar,  just  as  much  so  as  its  little  mulatto  counter- 
part. The  two  are  dollars  by  the  same  right  and  title — that  is  to 
say,  by  the  fiat  ot  the  Constitution  and  laws  of  the  United  States. 

LEGAL    TENDER    AT    HOME. 

That  Constitution  established  a  "  Government  of  the  United 
States,"  and  called  it  a  "government."  It  is  not  only  a  govern- 
ment, but  it  is  the  only  government  in  this  country  that  has  the 
character  of  nationality,  and  possesses  the  prerogative  of  determin- 
ing the  unit  of  values  here.  The  States  of  which  it  is  composed 
are  incompetent  to  declare  Avhat  is  money  or  to  regulate  its  value. 
"Whatever  power  there  is  over  the  currency  is  vested  in  Congress. 
If  the  power  to  declare  what  is  money  is  not  in  Congress,  it  is 
annihilated.  The  court  in  Legal  Tender  Cases,  12  Wall,  545. 
"  The  power  to  determine  what  shall  be  lawful  money  and  a  legal 
tender  is,  in  its  nature  and  of  necessity,  a  governmental  power.  It 
is  in  all  countries  exercised  by  the  government.  In  the  United 
States,  so  far  as  it  relates  to  the  precious  metals,  it  is  vested  in 
Congress  by  the  power  to  coin  money."  Chase,  Chief  Justice,  for 
the  Supreme  Court  in  Hepburn  vs.  Greswold,  8  Wall,  615.  Mr. 
Webster,  though  contending  that  paper  notes  could  not  be  made 
legal   tender,  in    which    respect   he   has   been    overruled   bjT  the 


72  SOUND  MONEY. 

Supreme  Court,  yet  held  it  to  be  indisputable  that  "  the  legal  ten- 
der in  this  country  is  gold  and  silver — either  the  coinage  of  our 
own  mints  or  foreign  coins  at  rates  regulated  by  Congress.  Con- 
gress," he  continues,  "  has  exercised  this  power  fully  in  both  its 
branches  It  has  coined  money,  and  still  coins  it;  it  has  regulated 
the  value  of  foreign  coin,  and  still  regulates  it.  The  legal  tender, 
therefore,  the  constitutional  standard  of  value,  is  established  and 
cannot  be  overthrown.  To  overthrow  it  would  shake  the  whole 
system  of  government."     4  Webster's  Works,  271. 

From  the  fact  that  the  government  of  the  United  States  is  a 
government  of  sovereign  power  in  respect  to  money ;  that  the 
States  are  prohibited  from  making  aught  but  gold  and  silver  legal 
tender,  as  coined  or  appraised  in  value  by  authority  of  the  United 
States  Government ;  that  Congress  is  empowered  by  the  Constitu- 
tion to  coin  money  and  regulate  the  value  thereof  and  of  foreign 
coins ;  that  Congress  has  established  from  the  beginning  of  its 
being  the  American  silver  dollar  as  the  unit  of  value  and  of  ac- 
counts in  the  United  States,  it  follows  that  this  dollar  is  worth  par, 
is  par,  without  any  reference  to  the  question  whether  the  silver  in 
it  would  buy,  if  in  the  form  of  metal,  eighty  or  a  hundred,  or  a 
hundred  and  twenty,  or  a  half  bushel  of  copper  cents. 

If  there  were  no  supreme  power  in  the  land  endowed  with  the 
prerogative  of  declaring  what,  shall  be  the  unit  of  value,  there 
could  be  no  certainty  in  contracts,  and  these  would  be  governed 
by  the  fickle  sanction  of  voluntary  consensus  which  itself  would 
lack  the  essential  element  of  coercive  validity.  Legal  tender  marks 
the  line  between  purchase  and  barter,  between  the  price  of  civiliza- 
tion and  the  swap  of  barbarism.  This  unit  may  have  a  mere  imag- 
inary existence  and  value ;  it  may  be  of  paper ;  it  may  be  of  metal ; 
indeed,  it  may  not  exist  at  all.  How  many  bankers  in  Lombard 
or  Wall  Street  know  that  their  ante-t}-pes  for  generations  never 
saw  a  pound  sterling  coin — the  fetich  which  they  worship  with 
heart  and  soul,  mind  and  strength,  might  and  main  ?  There  never 
were  any  such  coins  until  1815,  if  we  except  a  few  struck  in  the 
reign  of  Henry  the  VIII ;  yet  this  pound  sterling  has  been  the 
unit  of  British  currency  for  generations  past.  Length  is  material 
and  can  be  measured.  Weight  is  material  and  can  be  ascertained 
by  scales ;  and  if  allowed  to  drop,  will  mash  your  toes.  But  value 
is  an  ideal  thing.     The  coinage  acts  of  Congress  fix  its  unit  in  our 


SOUND  MONEY.  73 

country  as  a  dollar.  If  the  weight  and  composition  of  this  unit  be 
but  fixed  by  congressional  prerogative  there  might  be  no  piece 
actually  coined  of  the  denomination  of  the  dollar.  See  the  re- 
marks of  the  court  to  this  effect  in  Legal  Tender  Cases,  12  Wall, 
553. 

What,  then,  makes  the  piece  of  silver  coin  under  consideration 
a  dollar  ?  It  is  the  fiat  of  the  government,  exercised  bv  authority 
of  the  national  Constitution  in  the  performance  of  a  necessary 
functional  duty,  devolved  solely,  absolutely  and  autocratically  upon 
itself  as  the  supreme  government  of  the  United  States. 

INTRINSIC    VALUE    NON-ESSENTIAL. 

There  is  a  swarm  of  money  dealers  in  Loudon  who  say  that  our 
American  dollar  is  not  an  honest  one,  and  therefore  a  larger  swarm 
of  Americans  here  who  echo  their  words;  but  the  American  Con- 
gress, from  the  great  one  which  convened  in  1789  fresh  from  the 
battle-fields  of  the  war  for  American  independence,  and  all  its  suc- 
cessors down  to  the  present  time,  have  said  that  this  silver  coin, 
bearing  the  indellible  stamp  of  the  American  eagle  upon  its  face, 
is  and  shall  be  the  dollar  of  the  United  States. 

What  influence  the  possession  of  intrinsic  value  may  have  had 
on  Congress  in  fixing  upon  the  form,  weight  and  composition  of 
this  unit  dollar  is  immaterial.  Congress  was  exercising  a  prerog- 
ative duty,  and  having  exercised  it,  the  dollar  became  the  legal 
basis  of  every  contract,  irrespectively  of  the  value  of  the  metal 
out  of  which  it  was  formed,  if  melted  into  shapeless  mass. 

At  a  later  period,  that  is  to  say,  in  1862,  so  completely  and  ut- 
terly did  Congress  disregard  the  feature  of  intrinsic  value,  that  it 
issued  a  hundred  and  fifty  millions  of  dollars  of  Treasury  notes, 
and  affixed  the  legal  tender  function  to  them  all.  This  was  done 
in  the  depth  and  gloom  of  sectional  war.  After  the  war  was  over 
there  was  great  screaming  and  cawing  and  flapping  of  wings 
among  the  financial  rooks  of  Boston  and  New  York  over  the  le^al 
tender  attribute  possessed  by  these  notes,  and  representative  bank- 
ers brought  suits  to  put  a  quietus  upon  the  pretension  that  they 
possessed  it ;  but  the  Supreme  Court  of  the  United  States,  after  as 
full  argument  and  as  mature  deliberation  as  ever  was  given  to  a 
subject  by  that  authoritative  body,  ratified  the  action  of  Congress, 
and  decided  that  legal  tender  money  ordained  as  such  by  Congress, 
need  not  have  anv  intrinsic  value  whatever. 


74  SOUND  MONEY. 

Against  the  clamor  of  the  class  Avho  were  raising  Cain  over 
these  legal  tender  notes  the  Court  quoted  the  resolution  adopted 
by  the  Continental  Congress  of  1777,  during  its  desperate  struggle 
with  Tories  and  cockneys  in  red  coats,  declaring  that  Continental 
bills,  issued  in  maintenance  of  the  army,  ought  to  pass  current  in 
all  payments,  and  be  deemed  equal  in  value  to  the  same  nominal 
sums  in  Spanish  dollars,  and  that  any  one  refusing  to  receive  them 
"  ought  to  be  deemed  an  enemy  of  the  liberties  of  the  United 
States,"  and  calling  upon  the  State  Legislatures  to  pass  laws  to 
that  effect. 

It  is  as  true  now  as  it  was  in  1777,  that  when  Congress  has 
exerciced  its  bounden  and  necessary  duty  to  the  country,  of  declar- 
ing what  shall  be  the  unit  of  currency  in  the  United  States  it  is 
moral  Icesa  majestas  to  decry  that  unit;  and  if  words  could,  like 
overt  acts,  be  prosecuted  as  treason  in  this  country,  those  who  use 
them  clamorously  and  maliciously,  would  deserve  to  be  dealt  with 
criminally,  and  in  periods  of  public  danger  "  shot  upon  the  spot." 

OUR    DOLLAR    WORTH    PAR    INTRINSICALLY. 

But  aside  from  these  latter  considerations,  is  the  silver  dollar  of 
Congress  wanting  in  intrinsic  value  ? 

If  the  value  of  the  metal  in  this  coin  be  measured  by  its  cost, 
the  average  cost  of  the  dollars  in  existence  so  far  from  being  only 
50  cents  each,  is  not  less  than  250  cents.  The  statistics  of  silver- 
mining  show  that,  taking  all  mining  ventures  into  account,  there 
have  been  more  than  $3  expended  in  the  business  for  every  dollar 
that  has  been  realized  from  it.  Even  the  mines  that  have  survived 
bankruptcy  and  that  are  in  more  or  less  profitable  operation,  do 
not  show  themselves  to  be  bonanzas  in  the  matter  of  profits.  The 
Superintendent  of  the  mint  reports  the  cost  of  conducting  the 
successful  silver  mines  in  the  United  States  in  the  year  1890  to 
have  been  66  cents  for  every  dollar  mined. 

Measured  by  the  cost,  and  taking  into  account  onty  the  operated 
mines  of  the  two  Americas,  statistics  show  that  the  cost  of  all 
the  silver  obtained  has  approximated  100  per  cent,  of  the  value  of 
the  metal  vielded  by  the  mines. 

Yours, 

Ro.  W.  Hughes. 


Property  Values  and  Free  Silver, 


Richmond,  Ya 


To  the  Editor  of  the  Dispatch : 

In  a  former  letter  to  the  Dispatch  I  quoted  the  Atlanta  Consti- 
tution to  prove  that  property  valuations  for  the  year  1894  showed 
an  increase  over  1893  of  8338,000,000  in  the  three  States  of  Massa- 
chusetts, New  York  and  Pennsylvania,  while  in  thirty-one  Southern 
and  Western  States  a  decrease  of  more  than  8500,000,000  had 
taken  place  in  the  same  year.  Of  the  increase  in  the  three  States 
named  more  than  70  per  cent,  had  occurred  in  the  State  of  New 
York.  An  examination  of  the  last  census  reports  will  satisfy  the 
most  casual  reader  that  this  absorption  of  the  wealth  of  the  coun- 
try by  the  three  States  named  has  been  going  on  regularly,  and 
with  constantly -increasing  ratio  since  the  demonetization  of  silver. 
Where  it  will  end,  unless  we  retrace  our  steps,  no  man  can  tell. 

During  the  decade  from  1880  to  1890,  property  in  Massachusetts, 
New  York  and  Pennsylvania  increased  in  value,  in  round  numbers, 
$2,600,000,000;  while  like  values  in  the  twelve  States— Maryland, 
Virginia,  North  Carolina,  South  Carolina,  Georgia,  Florida,  Ala- 
bama, Mississippi,  Louisiana,  Texas,  Tennessee  and  West  Virginia 
— increased  during  the  same  decade  only  $800,000,000,  or  less 
than  one-third  of  the  increase  in  the  three  first-named.  In  New 
York  alone  the  increase  was  $300,000,000  more  than  in  the  twelve 
Southern  States  combined.  In  Pennsylvania  alone  $100,000,000 
more  than  in  the  twelve  Southern  States  combined. 

Remember  that  this  process,  as  I  have  said,  has  been  going  on 
with  increasing  ratio,  until,  as  the  Atlanta  Constitution  proves,  in  a 
single  year — 1893 — there  was  an  almost  uniform  decrease  in  the 
South  and  West  amounting  to  more  than  8500,000,000,  while  in 
New  York  alone  there  was  an  increase  of  considerably  more  than 
$200,000,000. 


76  SOUND  MONEY. 

So  much  for  ten  years  of  our  experience  with  the  gold  standard. 
Where  will  it  end? 

The  same  census  reports  show  that  in  the  South  the  number  of 
landowners  is  decreasing  year  after  year,  while  the  number  of 
tenants  is  on  the  increase.  Millionaires  on  both  sides  of  the  ocean 
are  purchasing  immense  tracts  of  Southern  and  Western  lands, 
equal  in  extent  in  some  instances  to  counties  ;  building  magnificent 
palaces,  which  are  guarded  by  retainers,  some  of  whom  are  paid 
more  than  the  Governor  of  Virginia,  while  men  whose  names  for 
a  century  have  been  household  words  in  the  South  are  glad  to  get 
positions  on  the  plantations  they  once  owned.  Are  we  drifting 
back  to  the  feudal  system?  Are  the  descendants  of  the  Custises, 
of  Marshall,  of  Jefferson,  of  Patrick  Henry,  of  Lee,  Jackson, 
Stuart  and  Hill,  to  be  the  retainers  of  the  Vanderbilts,  the  Goulds, 
the  Astors,  and  the  Rothschilds? 

Respectfully  yours, 

Charles  P.  Latham. 


Platform  of  the  Cook  Coimtu  Democracy 


THE  GREATEST  QUESTION  EVER  UP  BEFORE  A  FREE 
PEOPLE  FOR  CONSIDERATION. 


The  Democratic  party  in  its  National  Conventions  and  the 
Democracy  of  Illinois  have  uniformly  declared  in  favor  of  the  use 
of  both  gold  and  silver  standard  money  of  the  country. 

Silver  and  gold  have  constituted  the  money  of  the  Democratic 
party,  the  money  of  the  American  people  and  the  money  of  the 
whole  commercial  world.  It  was  by  the  use  of  both  that  the 
world  progressed  and  that  our  people  prospered. 

As  long  as  the  mints  of  the  world,  or  even  of  one  great  nation, 
remained  open  to  the  free  coinage  of  both  metals,  silver  and  gold, 
in  obedience  to  natural  law,  maintained  a  substantial  parity. 

That  law  is  that  the  privilege  of  coining  either  metal  into  debt 
paying  money  makes  a  demand  for  whichever  metal  tends  to  be 
the  cheaper.  This  natural  demand  increases  the  value  of  the 
cheaper  metal  and  the  lack  of  demand  decreases  the  value  of  the 
dearer  metal,  and  thus  an  automatic  and  natural  stability  of  the 
dearer  metal  is  obtained.  This  is  not  theory,  it  is  the  history  of 
centuries,  and  this  natural  law  maintained  the  parity  of  gold  and 
silver  at  substantiallv  their  coinage  ratio,  even  when  the  ratio  of 
their  productions  fluctuated  violently.  When  the  world's  produc- 
tion of  gold  was  three  times  that  of  silver,  and  when  again  it  was 
only  one-third  of  silver,  still  the  bullion  value  of  the  metals  under 
free  coinage  was  relatively  the  same. 

Not  until  silver  was  denied  free  coinage  at  the  mints  did  its 
value  and  that  of  gold  begin  to  diverge,  and  we  mean  that  the 
apparent  depreciation  of  silver  is  really  to  a  great  extent  the  ap- 
preciation of  gold.     Gold  has  become  clearer  because  the  immense 


78  SOUND  MONEY. 

added  demand  for  gold,  consequent  upon  the  demonetization  of 
silver,  has  made  it  dearer.  This  is  evidenced  bv  the  increased 
purchasing  power  of  gold  and  the  general  decline  of  the  prices  of 
commodities  since  1873.  There  never  has  been  and  is  not  now 
enough  gold  in  the  world  to  do  the  business  of  the  world.  The 
total  amount  in  existence  is  less  than  $480,000,000,  and  amounts  to 
only  about  $2.50  per  capita  for  the  population  of  the  world. 

To  make  any  single  metal  the  standard  of  value  is  to  choose  a 
standard  which  must  fluctuate  in  obedience  to  the  laws  of  supply 
and  demand.  Gold  monometalism  and  silver  monometalism  are 
fraught  with  peculiar  dangers,  because  their  burdens  fall  on  those 
who  are  least  able  to  endure  them.  Bimetalism  furnishes  a  stan- 
dard more  stable  than  any  other,  because  each  of  the  two  metals 
systematically  prevents  or  counteracts  the  undue  appreciation  of 
the  other.  The  gold  standard  is  dishonest  and  oppressive,  because 
gold  tends  steadily  upwards  and  makes  the  debtor  pay  more  than 
he  owes.  Upon  the  Republican  party  rests  the  responsibility  of 
the  closing  of  our  mints  to  silver  and  the  practical  supremacy  of 
gold  monometalism,  and  we  adjure  its  members  in  the  name  of 
patriotism  and  humanity,  to  forsake  their  false  guides  and  to  join 
with  us  in  prompt  and  thorough-going  measures  to  correct  the 
evil  which  they  have  brought  into  existence,  and  to  return  to  the 
double  standard  approved  by  Hamilton  and  Jefferson. 

There  are  other  abuses  of  the  currency  system  which  must  also 
be  removed  until  we  stand  upon  the  firm  foundation  of  the  pre- 
cious metals  as  the  basis  of  our  money  system,  every  dollar  of 
equal  intrinsic  worth,  and  no  money  founded  upon  mere  promises 
to  pay  not  backed  by  gold  and  silver. 

We  deny  the  statement  of  our  adversaries  that  we  favor  repu- 
diation, or  50-cent  dollars,  and  insist  that  by  the  operation  of  the 
natural  law  of  supply  and  demand  the  gold  and  silver  dollars, 
when  freely  coined  at  the  ratio  of  16  to  1,  will  adjust  themselves 
at  a  practical  equality,  just  as  they  did  before  1873. 

There  is  not  and  never  has  been  in  the  United  States  a  50-cent 
silver  dollar,  and  the  only  reason  that  the  bullion  in  a  silver  dollar 
can  be  said  to  be  worth  50  cents  is  because  that  bullion  has  been 
excluded  from  the  mints  and  is  unfairly  compared  with  appreciated 
gold. 


SOUND  MONEY.  79 

We  are  not  opposed  to  an  international  agreement.  We  invite 
such  action,  but  we  are  opposed  to  waiting  one  day  or  one  hour 
for  foreign  aid.  International  conferences  have  heretofore  been  a 
failure,  whether  well-intended  or  conceived  in  the  interest  of  delav. 
We  believe  that  this  nation  can  and  should  legislate  for  its  own 
people. 

Therefore,  be  it  resolved  by  the  Democracy  of  Cook  county  that 
we  demand  the  immediate  restoration  of  the  free  and  unlimited 
coinage  of  silver  at  the  ratio  of  16  to  1,  as  it  existed  prior  to  1873, 
without  waiting  for  the  aid  or  consent  of  any  other  nation,  such 
gold  and  silver  coin  to  be  the  legal  tender  for  all  debts,  public  and 
private. 


6661 


